India's two-wheeler industry is exploring CNG, ethanol-blends, and electric options simultaneously, driven by diverse rider needs for affordability, emissions reduction, and practicality, while infrastructure gaps and upfront costs remain key challenges to widespread adoption.
10 Jan 2026 | 602 Views | By Devesh Taparia, DriveX
Every big shift in India’s two-wheeler market seems to start with a simple question - what do riders need? And if we’re being honest, the answer has never really been just about price or performance. It’s about finding a bike that fits real life. These days, that also means looking ...
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Every big shift in India’s two-wheeler market seems to start with a simple question - what do riders need? And if we’re being honest, the answer has never really been just about price or performance. It’s about finding a bike that fits real life. These days, that also means looking at smarter fuel choices, cleaner options, and practical alternatives to petrol that work for the long run.
Electric scooters and bikes have been stealing the spotlight for a while now. With about six percent of the two-wheeler market by the end of Oct 2025, they’re making decent headway, indicating steady adoption momentum in the segment, they form a small slice of the overall market but are making decent headway.
At the same time, three-wheelers in India have seen much higher electric penetration, underscoring why policymakers and manufacturers continue to explore multiple fuel pathways for two-wheelers rather than betting on one technology alone.
If you talk to anyone in the industry, they’ll tell you straight up, the future isn’t going to belong to just one fuel. It’s going to be a mix. Electric, CNG, ethanol blends, and potentially other options will all have a role to play. And honestly, that feels right. Not every rider is chasing the same thing.
Some are looking to bring down their fuel bills. Others care about cutting emissions. Plenty just want a bike that’s reliable, affordable, and ready for the daily grind. Manufacturers and policymakers have picked up on that too, which is why you’re seeing more talk – and more concrete action – around alternative fuels that make sense for the average rider.
CNG two-wheelers: cleaner and cheaper, with caveats
Take CNG two-wheelers. They’ve been in the news for their potential to significantly cut emissions per km in many duty cycles – studies claiming up to 50 percent less carbon dioxide (CO₂), around 75 percent less carbon monoxide (CO), and almost zero non-methane hydrocarbons (HC) depending on engine design and test conditions – compared to a regular petrol engine.
But it’s not just about cleaner air. In India, where CNG is widely available, CNG-powered two-wheelers can often deliver 40 to 60 percent lower running costs per km compared to petrol, thanks to lower fuel prices and good km/kg fuel efficiency. That’s a big deal when your bike is your everyday ride or your livelihood. For fleet operators and delivery riders who clock high daily mileage, the savings can compound quickly over a year.
That said, it hasn’t been all smooth sailing. CNG stations are still concentrated in larger cities and specific corridors, which limits the appeal of CNG two-wheelers in smaller towns and rural areas. Conversion kits add to the upfront cost, can compromise packaging or boot space, and poor-quality or non-approved installations raise safety concerns.
For the pre-owned market, CNG adds another layer. In cities with a strong CNG ecosystem, such bikes can hold their value well on the back of low running costs, but resale liquidity can drop sharply outside CNG corridors. Buyers therefore look closely at fuel availability in their own usage geography before paying a premium for a CNG-equipped vehicle.
The segment is getting attention from the OEMs, with Bajaj launching the Freedom 125 as a production CNG motorcycle, and TVS Motor showcasing TVS Jupiter CNG as a concept scooter. As the network of CNG stations grows and more OEM-integrated CNG solutions come to the market, the value proposition for urban and peri-urban users will strengthen, and chances are we’ll see a lot more of these bikes out on the roads, especially where keeping fuel costs low really matters.
Ethanol-blend and flex-fuel motorcycles
Then there’s ethanol-powered and ethanol-blend two-wheelers. These bikes are built to run on higher-ethanol blends, giving riders a renewable alternative to pure petrol.
Ethanol does usually mean slightly lower mileage. Government and technical assessments suggest that at E20 blends, fuel economy can drop by around 6–7 percent compared to pure petrol in typical spark-ignition engines, though calibration can recover part of this loss. On the upside, ethanol can reduce tailpipe CO and HC emissions and cut net lifecycle CO₂ when the supply chain is well-managed.
With the right tax and pricing signals, plus possible incentives for flex-fuel-capable vehicles, riders may increasingly accept a small mileage penalty in exchange for lower emissions and, over time, more stable fuel costs.
Globally, the flex-fuel market is expected to grow steadily. One market-research estimate pegs the global flex-fuel market at around USD 9.38 billion in 2025, with projections of approximately USD 19.7 billion by 2032 on the back of strong adoption in countries like Brazil and the United States. Brazil’s experience with flex-fuel motorcycles is particularly relevant for India, demonstrating that high ethanol blends can work at scale in the two-wheeler ecosystem when fuel infrastructure, regulation, and consumer awareness evolve in sync.
India has pursued an aggressive blending roadmap, and by March 2025 the country reported achieving an average of 20 percent ethanol blending (E20) nationwide, ahead of the earlier 2025–26 target, clearly showing the policy attention that this segment is getting.
TVS Motor led the charge here with the TVS Apache RTR 200 Fi E100, India’s first ethanol-powered motorcycle, designed to run on a mix of up to 80 percent ethanol and 20 percent petrol. It wasn’t just another model launch; it was a signal that Indian OEMs are innovating on engines and fuel systems for local biofuel realities while aligning with global sustainability objectives. Other OEMs have since declared that most of their new petrol motorcycles are E20-compatible, anticipating the shift in retail fuel standards.
India’s ethanol journey however also has an agricultural and rural dimension. Higher blending targets create demand for sugarcane, grain-based ethanol, and advanced biofuels, which can support farmer incomes but also raise questions about land use, water consumption and crop selection. Balancing these trade-offs will be critical for ethanol to take off in India as an alternative fuel, by moving from policy vision to everyday reality at fuel pumps and getting the riders to really understand the benefits.
LPG, hydrogen and hybrid concepts
Beyond CNG and ethanol-blends, manufacturers and researchers are already experimenting with other fuels like LPG, hydrogen, and various forms of hybridization in two-wheelers.
LPG-powered two-wheelers have appeared in some international markets via conversion kits, mainly as a low-cost alternative for small-displacement engines, but in India such applications remain limited and largely aftermarket. Hydrogen two-wheeler prototypes and concepts have been showcased globally, yet in India most hydrogen activity is still focused on buses, trucks and some three-wheeler pilots rather than scooters or motorcycles.
Meanwhile, hybridization in two-wheelers tends to be closer to micro-hybrid or stop-start systems than the strong parallel hybrids seen in cars. These approaches aim to reduce fuel consumption and emissions without drastically increasing vehicle cost or complexity for mass-market segments.
These technologies are unlikely to show up on every street tomorrow, but they demonstrate that the industry is not sitting back. OEMs are experimenting across the fuel and technology spectrum to find viable pathways for cleaner, more efficient urban mobility.
The pre-owned and refurbished opportunity
One aspect that doesn’t always get talked about is how this shift is playing out in the pre-owned market. Buyers are not just hunting for a bargain anymore; they are looking for value. They want lower running costs, a smaller carbon footprint, and a bike that fits their lifestyle. That’s why refurbished two-wheelers - restored with care, upgraded where necessary, and made road-ready again - are gaining traction, especially when they come with transparent information on fuel type and compatibility.
Alternative fuel options add both upside and complexity here. CNG and ethanol-powered models are starting to get noticed as conscious choices for a new generation of riders who clock high mileage or care about emissions, especially in metros and larger cities. Bikes that are engineered well for these fuels and save on running costs tend to hold value better in their natural demand pockets.
Digital platforms are stepping up and playing an important role. Verified listings, warranty-backed refurbishments, and clear information on fuel compatibility are making a real difference by giving buyers more confidence and sellers more leverage.
For pre-owned CNG or LPG vehicles, documentation about kit approval, installation, and cylinder test dates is critical from both a safety and value perspective. For ethanol, properly communicating whether the engine and fuel system are certified for E20 or higher blends can protect both buyers and sellers as India shifts its baseline fuel standard.
Of course, it’s not all perfect. Infrastructure gaps are real. Upfront costs for alternative-fuel-compatible vehicles can still be higher than for basic petrol models. And most people still don’t know enough about these fuel options or how to use them correctly – or example, the risks of running higher-ethanol fuel in a non-compatible motorcycle, or the importance of periodic cylinder testing in CNG/LPG vehicle.
But OEMs are getting ready. While a good mix of petrol, CNG, ethanol and electric models will allow the companies to cater to a larger market, companies that build strong education, after-sales support and transparent quality processes around these bikes are better positioned to lead as adoption picks up,
Policy, infrastructure and where this is headed
India’s policy landscape is clearly nudging the market toward cleaner fuels rather than a single alternative. On one side, city gas distribution expansion and support for CNG infrastructure aim to make gas a viable urban mobility fuel over the long term. On the other side, the National Policy on Biofuels and the E20 roadmap have already pulled forward ethanol blending timelines, with regulatory work underway to define standards for higher blends and flex-fuel-capable vehicles.
At the same time, tightening emission norms like BS6 and its subsequent stages are pushing OEMs to extract more efficiency and lower emissions from every liter (or kilogram) of fuel, regardless of whether it is petrol, CNG or ethanol blend. This regulatory pressure aligns with the economics of fleets and high-usage riders, for whom total cost of ownership, not just sticker price, determines the vehicle choice.
At the end of the day, this whole shift isn’t about chasing one big winner. It’s about really understanding what different segments of riders actually need and giving them honest choices – electric for some, CNG or ethanol for others, and efficient petrol where alternatives are not yet practical.
Whether you’re buying new or pre-owned, the smart move is to pick a bike that’s built for the way you actually ride, compatible with the fuels realistically available on your routes, and supported by a service ecosystem that can keep it running safely and efficiently over the long term.
And maybe that’s the real question we all need to start asking: are we choosing bikes that really fit our roads, our needs, and our future?
Devesh Taparia is the CEO of DriveX. Views expressed are the author's personal.