New Delhi, Dec 24 (IANS): In a bid to reign in India's increasing oil import bill, the Union government is considering to introduce methanol-blended fuel across the country.

Sources said the government is planning to introduce 15 per cent methanol-blended fuel. The move is also aimed at checking rising pollution levels, sources said.

Methanol is likely to cost only about Rs 22-24 a litre, thus reducing petrol price by about 10 per cent. It could also save nearly Rs 5,000 crore annually in oil imports besides reducing pollution levels by over 30 per cent.

Going by the current tax structure and the existing retail prices of methanol-blended fuel, petrol prices would be cheaper by around Rs 7-8 per litre.

Ever since it came to power, the NDA government has been pushing for various alternative fuels to secure the country's long-term energy needs. It has been promoting the use of solar power, wind power and bio-fuels that include 10 per cent ethanol blended with petrol.

In 2018, it approved a new bio-fuel policy allowing the use of food substitutes and food grains as feedstock for production of ethanol meant for blending with petrol.

Vehicles in the country use 10 per cent ethanol-blended fuel, which although is cheaper than petrol, yet is on the higher side when compared to methanol.

According to people in the know of things, the Road Transport Ministry has notified the regulations and now the Petroleum Ministry would have to play its part in the implementing the plan.

NITI Aayog had projected an annual reduction of $100 billion in crude imports by 2030 if the country moves to 15 per cent methanol-blended fuel, both for transportation and cooking.

In the last financial year, India spent $111.9 billion in crude oil imports. For the period April-November 2019-20, India's import bill stood at $69.5 billion.