New Delhi, May 14 -- The government's push for flex-fuel vehicle rollout is facing a classic chicken-and-egg stalemate.

Automakers aren't ready to commit to producing vehicles that run on high ethanol blends until the fuel is widely available. Oil marketing companies, on the other hand, are unwilling to invest in storing and supplying blends such as E85 and E100 until there are enough such vehicles on the road, according to three people aware of the development.

The government is in talks with automakers and oil marketing companies to resolve the deadlock, the people cited above said, requesting anonymity.

Unlike standard vehicles, flex-fuel vehicles can run on petrol or any petrol-ethanol blend. India currently mandates a nationwide s...