CAFE weight relief for small cars will favour 1 firm: Swadeshi Jagran Manch

Mahajan warns that a sub-909 kg carve-out could distort competition, curb R&D and slow India's clean-mobility goals

The proposed special exemption for petrol cars under 909 kg in the upcoming CAFE-3 carbon dioxide emissions regulation will favour a “single company”, hamper research and development (R&D) and “adversely” affect transition to electric vehicles (EV) in India, said Ashwani Mahajan, national co-convenor of Swadeshi Jagran Manch, an economic think tank affiliated to the Rashtriya Swayamsevak Sangh (RSS).

 

“The simple conclusion is that relaxing CAFÉ-3 norms for lesser weight cars will actually hamper R&D in India,” he said in a post on social media website LinkedIn.

 

“This sector, which has been showing fairly healthy growth and has also been meeting sustainability and safety standards, will suddenly face the problem of lopsided growth, in favour of low weight cars with no benefit to the consumer and will favour a single company, impacting fair competition, dwarfing the growth of the overall sector. This is also likely to adversely affect transition to electric vehicles,” he added.

 

The CAFE (corporate average fuel efficiency) framework sets average carbon-dioxide emission targets that each automaker’s fleet must meet, measured in grams of carbon dioxide emitted per kilometre (g/km). If a company fails to meet its target, the Bureau of Energy Efficiency (BEE), which works under the Ministry of Power, can impose stiff penalties.

 

In June 2024, the BEE had published the first draft of CAFE-3 norms, which would apply between FY28 and FY32. The Society of Indian Automobile Manufacturers (Siam), after thorough discussions with its members, submitted its initial comments in December 2024, seeking several changes. A few months later, Maruti Suzuki (MSIL), India’s largest carmaker and the biggest small-car seller, independently approached the BEE requesting relief for small cars through a weight-based exemption. This move has sharply divided the auto industry.

 

Mahajan, in his LinkedIn post, said, “The final CAFÉ-3 policy should avoid creating a special carve-out for vehicles below 909 kg. A lighter kerb weight does not automatically translate into affordability, and linking emission relaxations to weight will open regulatory loopholes for OEMs (original equipment makers) to game the system by staying below the threshold instead of investing in cleaner technologies.”

 

“Globally, no major market gives weight-based exemptions that compromise long-term climate goals. India should not dilute its own ambition at a time when the world expects us to lead on clean mobility. Relaxing norms for sub-909 kg cars risks locking the industry into old ICE platforms, discouraging R&D, and weakening the business case for EVs, the very technology India wants to scale,” he added.

 

Mahajan mentioned that the focus must remain on innovation, electrification, and future-ready mobility, not on short-term distortions that undermine CAFE norms and India’s technological leadership.