A committee of senior bureaucrats has made recommendations to the Niti Aayog that include tightening fuel efficiency norms for four-wheelers with combustion engines in order to give a fillip to electric vehicles (EVs).

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As per a report accessed by CNBC-TV18, the rationale behind this suggestion is the fact that automobile industry will be left with no option but to manufacture and sell more EVs once fuel efficiency norms for petrol- and diesel-powered vehicles are tightened.

The report said, “To have approximate induction of 3 to 5% EVs, as against total manufactured vehicles, the fuel efficiency norms have to be lower by 20-25 percent over FY 2017-18 data.”

Earlier this year, the central government mandated fuel efficiency norms that require cars to be 30 percent more fuel efficient by 2022. The move is expected to help in reducing carbon footprint.

While the proposal is only in discussion stage, the industry has naturally expressed shock.

Top industry sources, who wished not to be quoted, told CNBC-TV18, “We are busy transitioning from BS-IV to BS-VI. All technical resources are geared up for this. To throw in more challenges at this stage would be completely unfair. Such a move could impact auto companies, the components industry and also the economy”.

Another top executive at one of India’s leading carmakers said, “Let us not forget the consumer in all of this. What is the guarantee that the product will be acceptable to the consumer and battery prices will have to come down substantially which they haven’t so far”.

Industry experts also warned that the move would force them to make diesel and petrol vehicles more expensive.

Industry sources believe that cross subsidisation could have repercussions under the competition act and may also invite trouble from tax authorities.

Another recommendation of this report submitted to the Niti Aayog is that cab aggregators like Ola and Uber should be directed to have a minimum 2 percent of their fleets as EVs.

First Published:Jun 13, 2018 7:15 PM IST