The scheme will start with two pilot projects in Assam and Maharashtra, where it will operate a total of 20 vehicles.
A ministerial meeting on methanol transport, chaired by Road Minister Nitin Gadkari, saw plans discussed to boost production of the biofuel – politicians said the use of methanol could reduce India’s crude oil imports by a fifth.
A government official said: “The projects being planned to launch in Maharashtra and Assam will see running of a fleet of 10 buses each in both the states, fuelled by methanol.”
The official added the projects would be sponsored by the Ministry of Road Transport and Highways.
India’s public owned banks and finance groups lent more money to coal projects than renewables in 2017.