India removes small car fuel concession in revised emission rules
India has scrapped a fuel-efficiency concession for small cars in its latest draft regulations. The move forces automakers to ramp up electric vehicle production to meet stricter emission targets by 2032.
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The India 
IN Power Ministry announced on February 6, 2026, that it has removed a planned concession for small petrol cars from the revised draft of upcoming Corporate Average Fuel Efficiency (CAFE) norms. This decision follows arguments from automakers that the specific carve-out would have disproportionately benefited a single company. The removal of this concession is part of a broader set of updates to the regulatory framework in India IN that will significantly increase compliance pressure on manufacturers across the sector.
IN Power Ministry announced on February 6, 2026, that it has removed a planned concession for small petrol cars from the revised draft of upcoming Corporate Average Fuel Efficiency (CAFE) norms. This decision follows arguments from automakers that the specific carve-out would have disproportionately benefited a single company. The removal of this concession is part of a broader set of updates to the regulatory framework in India IN that will significantly increase compliance pressure on manufacturers across the sector.The updated draft introduces several critical changes to the CAFE framework, including the tightening of weight-related parameters and the establishment of steeper emissions-reduction pathways. To balance these requirements, the ministry has introduced a system of credits for electric and hybrid vehicles (EVs and plug-in hybrids). These revisions are designed to shape the industry's fleet emissions targets and will directly influence the product and powertrain investment plans of major players such as Tata Motors Limited , Mahindra & Mahindra Limited , Maruti Suzuki India Limited , and Volkswagen AG .
