This paper deals the policy and planning issues for utilization of ethanol and biodiesel in automotive diesel engines in Indian context in view of environmental benefits, energy self-sufficiency and boosting of the rural economy as well as measures related to implementation and barriers. The main focus of this paper is on transport and refinery scenario, land availability for production of biodiesel and potential sources for biodiesel and ethanol. The availability of ethanol and estimations for its consumption as transport fuel are made and necessary remedial measures to increase the availability of ethanol in the country in future are suggested. (c) 2005 Elsevier Ltd. All rights reserved.