India targets $30bn SAF export market on cheap hydrogen edge
India is positioned to produce sustainable aviation fuel up to 40% cheaper than global benchmarks, creating a $30 billion export market by 2040 and attracting early corporate investment.
India could become a dominant global supplier of sustainable aviation fuel (SAF), producing it at costs up to 40% below international benchmarks. A joint study by the IECC at UC Berkeley and Energy Innovation projects this cost advantage will transform India's crude oil import vulnerability into a $9 billion export opportunity by 2030, scaling to $30 billion by 2040.
This edge relies on Power-and-Biomass-to-Liquids (PBtL) technology, which combines agricultural waste with green hydrogen to yield roughly twice as much fuel as conventional biomass processes. The resulting drop-in fuel requires no changes to aircraft or airport infrastructure, offering airlines a technically simple path away from fossil fuels.
India possesses the specific inputs required to scale PBtL economically. Harvesting just 4% of the country's surplus crop residue would supply 25% of global SAF demand. Simultaneously, India's green hydrogen prices fell from $4.67 per kilogram in June 2025 to $3.23 in February 2026, driven by cheap solar power, and are projected to drop below $3 by 2030.
Global SAF supply currently meets only 0.6% of jet fuel consumption, far short of the 65% target needed for net-zero aviation by 2050. Production has been constrained by high costs—SAF runs two to five times more expensive than regular jet fuel—and shortages of traditional feedstocks like cooking oil. India's reliance on farm waste bypasses these supply bottlenecks and avoids the food-versus-fuel debate.
New Delhi is simultaneously moving to insulate its domestic market from traditional fuel volatility. Following an aviation turbine fuel price surge after the outbreak of the Iran war, India established a 100 billion rupee ($1.05 billion) Price Stabilization Fund. This mechanism caps domestic jet fuel at 115 rupees per liter via interest-free financing to state oil marketing companies, shielding carriers like IndiGo and Air India.
Capital is now moving to capture the mandated 5% domestic SAF blending target and broader export potential. California-based Aemetis is planning an Indian IPO for its Universal Biofuels subsidiary, which already operates an 80-million-gallon biodiesel plant on the country's east coast. Backed by $3.8 billion in airline SAF contracts and a $3.2 billion renewable diesel agreement, Aemetis intends to use the proceeds to convert its existing capacity into dedicated SAF production.
