<p>India is on track to achieve ethanol-blending with gasoline of 20% (E20) by mid-2025, with the aim of upgrading to E25 by 2030, contributing toward the Sustainable Development Goals 7 and 13. The government is targeting a more diversified portfolio, transitioning from a sugarcane-based ethanol to a rice and maize-based ethanol mix. This study evaluates for the first time the economic and environmental impacts of achieving E25 blending by 2030 using the input–output framework. Results show that maize-based ethanol production has the highest positive macroeconomic impact across total output, GDP, and employment by 0.53%, 0.48%, and 1.69%, respectively, and the least water and GHG footprint compared to sugarcane and rice-based ethanol production. This diversification leads to marginal price impacts with 1.47% when balanced between sugar and grain-based ethanol and 1.15% when met through 100% maize-based ethanol. However, the procurement of 43 million tonnes of maize would require diverting two-thirds of the current production area of maize toward the fuel market, which has the potential to Generate substantially higher inflationary pressures in the food market. Furthermore, rice and maize-based ethanol leads to the production of 13.5 million tonnes of Dried Distillery Grains, accounting for 13.2% of the livestock feed requirement. Policymakers need to take into consideration the synergy between agriculture and ethanol industries while targeting the decarbonization of the road transportation sector with the long-term goal of net-zero emissions by 2070.</p>