India stands at an energy crossroads. With rising global instability and climate pressures, embracing biofuels like biodiesel and Sustainable Aviation Fuel offers a path to energy security, economic resilience and environmental leadership in a post-fossil fuel future
To be, or not to be.” Shakespeare’s Hamlet posed his existential question centuries ago, but in the 21st century, India faces a similar fateful choice: whether to persist with an oil economy chained to imported fossil fuels, or to boldly embrace biofuels — especially biodiesel and Sustainable Aviation Fuel (SAF) — as the foundation of a more resilient, self-reliant future. The decision is not academic. It will shape the nation’s economic security, public health, strategic autonomy, and it’s standing in a world buffeted by both geopolitical conflict and climate crisis. The importance of alternatives to fossil fuel has been recognised the world over, and even the international bodies are making coordinated efforts to promote biofuel development and adoption. The Paris Agreement — a global treaty for limiting global warming — does emphasise transitioning to biofuels, substituting reliance on fossil fuels. Brazil’s RenovaBio programme provides for an increase in biofuel production and consumption. Similarly, the UN Renewable Energy Agency encourages international cooperation in promoting biofuel production and trade.
India, being a signatory to the Paris Agreement, has been actively following the commitments to address the issue of global warming and defined five goals (Panchamrit) — announced by the Prime Minister at COP 26 in Glasgow. The larger goal is to achieve net zero emissions by 2070 through identified action points. It is heartening to know that we have already achieved one goal before the scheduled date (50 per cent energy requirement from renewable energy) of 2030. India has also integrated green energy with its developmental agenda. Initiatives such as the “PM Jivan” scheme and the promotion of “One Ped Ma Ke Naam” are unique and prove the country’s commitments to a better and cleaner future for the new generation. Indian effort and strategy can serve as a model for other developing countries.
Petrodollar Chains: Old Risks, New Vulnerabilities
Recent Government data shows that our energy needs of more than 50 per cent are being met from non-fossil fuel resources. In this, solar-based power generation is emerging as a key player and contributor. Historically, India has long depended on imported crude, with over 85 per cent of its oil coming from abroad. This economic reality ties India’s fate to the ‘petrodollar’ system: global oil transactions conducted in US dollars, a system that not only enriches oil-exporting countries but reinforces US financial hegemony. The consequences — India’s economy remains hostage to supply disruptions, OPEC+ cartel manoeuvring, and the price shocks as a result of geopolitical turmoil. The 2022-23 energy crunch triggered by the Russia-Ukraine conflict, which sent oil prices and inflation soaring, is only the most recent reminder that dependence on mineral oil can inflict swift and severe pain. The US Government’s new move to impose 100 per cent duties on countries that are importing oil from Russia reflects the vulnerability of countries like India who import a substantial quantity from Russia to meet their domestic demands. One has to wait and watch to understand the real implication of such a condition on our economy and geopolitical relationships.
But the true cost of fossil fuels goes far beyond the market price at the pump. Our continued reliance on oil exacts invisible but massive tolls — polluted air, oil spills, respiratory illnesses, and the staggering reach of climate change. Globally, the International Monetary Fund estimated fossil subsidies (including hidden health and environmental costs) at a staggering $7 trillion in 2023. Such externalities are never reflected in the price of petrol, but the public pays for them all the same — in hospital wards, in lost crops, in balance-of-payments crises.
It is true that as compared to fossil fuels including coal, oil, and natural gas, biofuels are definitely superior alternatives to counter the emerging challenges of climate change and deal with the arm-twisting tactics by the fossil fuel lobby. In addition, there are other advantages offered by biofuels such as environmental friendliness, easy biodegradability, availability in abundance, renewable nature and sustainability, besides being price competitive.
Biofuels generally include solid biofuels (solid biomass, biochar), liquid biofuels (bioethanol, biodiesel), and gaseous biofuels (e.g. biogas, biohydrogen). Biofuels, such as ethanol, biodiesel, and biogas, are produced from renewable organic materials, including crops, algae, agricultural residues, and waste.
Countries across the globe are taking steps to promote the usage of biofuel. The European Union has proposed to achieve 14 per cent renewable energy in transport by the year 2030, with strict sustainability criteria for biofuels. Countries like Brazil and India are investing heavily in ethanol and biodiesel programmes to reduce dependence on fossil fuels. India announced a biofuel policy in 2018 which allows the production of ethanol from damaged wheat, sugarcane, rotten potatoes, corn etc. and provides incentives for biorefineries. Its focus is to promote biodiesel production from non-edible oil seeds, used cooking oil and short-duration crops. It has advanced the ethanol blending targets in petrol to 20 per cent by 2025-26.
Biofuel Pathway: Sovereignty, Security, and Circular Prosperity
This is where biodiesel and SAF offer a transformative alternative. Rather than importing crude, biofuels can be produced right here in India from waste and residues: used cooking oil, acid oil from vegetable oil processing, palm oil effluent, and a mountain of agricultural waste. Biofuels insulate India from global oil shocks while powering a new economy rooted in local jobs, clean technology, and rural prosperity. Waste to Wealth is the new slogan — offering immense opportunities for new entrepreneurs and other stakeholders involved in last-mile collection and segregation. Circular economy — promotes India’s vision of ‘AtmaNirbhar Bharat’ and “Gram Swaraj” — thereby fulfilling the aspirations of millions living in rural India by offering employment opportunities at the local level.
Consider the numbers: India discards more than 1.5 million tonnes of used cooking oil and acid oil each year, much of it dumped unchecked, clogging drains and polluting rivers — or worse, illegally recycled into food, threatening public health. Properly processed, that very waste becomes valuable fuel.
A single 1-million-tonne-per-year biodiesel plant can generate up to 7,000 direct and indirect jobs, primarily in rural and waste sectors — on top of cleaning up India’s waterways and skies.
Sustainable Aviation Fuel (SAF) is no less revolutionary. International aviation must decarbonise, and airlines are desperate for scalable alternatives to fossil-based jet fuel. SAF made from used oils and agricultural residues cuts CO2 emissions by up to 70 per cent over its lifecycle, while plugging India directly into the future of global green commerce.
Economic and Policy Winds Are Shifting
The resources and technology are available, and the winds of global investment are shifting too. While traditional fossil giants still draw state bank loans and sovereign fund investments, climate-conscious capital — green bonds, impact funds, and carbon credit markets — is flowing into biofuels. ESG (environment, social, governance) mandates and net-zero targets mean major corporations and Governments are seeking verified, traceable biofuels rather than risk the reputational hit of ‘greenwashing.’ Modern Indian biofuel plants, using advanced process automation, now deliver auditable supply chain data and emissions savings, opening doors to international finance. The Government’s policies have begun to reflect this reality. From the Ethanol Blending Programme to the National Bio-Energy Mission and initiatives promoting waste-based SAF production, India is laying the foundations for a biofuel revolution — one aligned with global trends, national goals, and rural livelihoods.
Circular Economy: Turning Waste into Wealth
At the heart of the biofuel transition lies the idea of the circular economy. Instead of treating used oil or crop residue as waste, India can turn them into valuable fuel, closing the loop of extraction, use, and disposal. This reduces methane emissions from landfills, prevents toxic oil reuse in the food chain, and significantly relieves the municipal burden of waste management. By doing so, India can monetise what is currently a billion-dollar loss each year.
Answering Shakespeare’s Question in Policy and Practice
India’s energy dilemma is not merely technical but profoundly strategic: remain mired in import dependency with all its costs, or step confidently into a future of energy sovereignty and inclusive growth. The right policy mix — scaling advanced biodiesel and SAF, leveraging carbon markets and green credits (announced by the Government), building export-ready biofuel clusters, rewarding verified emissions reductions, and fostering global partnerships — will turn vision into reality.
“To be or not to be?” For India, the answer is clear: to be energy sovereign, to be clean, to be resilient — by embracing biofuels, especially biodiesel and SAF where the bulk of the requirements lie. It is the economic, environmental, and strategic choice of our times. Also, in an era where India is aspiring to be a global superpower — initiatives in reducing dependency on fossil fuel through strategic and time-bound action can definitely become an example for other countries to emulate and establish Indian leadership amongst the nations.
(Dinesh Kumar Tyagi is retired IAS officer; Suman Bose is President and Co Founder — GreenSource Energy Pte Ltd (Singapore) and Co Founder of GoFar Advisory & Investments Pte Ltd)