Weighty matters for cars: CAFE row overlooks public-policy objectives

From the point of view of optimal urban-traffic management and, indirectly, urban pollution and public-health objectives, this exemption could, however, be seen as unexceptionable

The government’s draft norms for the third edition of Corporate Average Fuel Efficiency (CAFE-III), applicable between FY28 and FY32, have raised afresh the debate in the Indian automobile industry on incentivising small cars over big cars. The contours of the current controversy involve implications that go beyond the question of affordability to often conflicting questions of structural changes in automobile markets, urban pollution, public health as well as safety standards. 

 

CAFE norms, in force since FY18, have set out fleet-wide carbon-dioxide emission targets for all manufacturers of passenger vehicles. They entail cutting fuel consumption on each car. CAFE-III stiffens these