The first diesel additive, which promises to improve the fuel efficiency of diesel by five per cent to 10 per cent, will be followed by additives for gasoline. In France, as in most parts of the developed West, additives are added to fuels like diesel and gasoline before they reach the retail outlets.

Fuel with additives qualify for a premium market for diesel, gasoline and other petro-fuels. At home both petrol (gasoline) and diesel prices are controlled through the administered pricing mechanism (APM). The price controls, however, are destined to wither away by 2002. Indianoil, which is doing the groundwork for its ``Servo premium gasoline'' and ``Servo premium diesel'' launch by then, begins testing the waterswith the diesel additive. The additive will initially be imported from Elf and packaged and marketed at home by Indianoil.

The 20 ml, 40 ml and 100 ml pouches -- priced at Rs 16, Rs 30 and Rs 45, respectively -- will bear the twin logos of Indianoil and Elf. Subsequently, Indianoil will begin manufacturing the additive at Taloja, with technological input from Elf. Meanwhile, Elf will get a royalty for its technology and a commission out of the marketing margins. Indianoil is initially targeting the truckers and bus operators, who account for 70 per cent of the 40 million tonne of diesel consumption in the country.

Servo-Elf said Indianoil chairman M A Pathan, would be a boon for customers. The additive will cost 30 paise a litre, said Indianoil director (human resource development and business development) Subir Raha, while the fuel saving would amount to 60 paise per litre.

``The most important emphasis in the new millennium will be pollution control and energy saving,'' said Elf Antar research anddevelopment(R & D) chief Alain Faure.