TL;DR
An ex-NITI Aayog official warns that proposed CAFE-III rules with hybrid credits and small car waivers could hinder India's EV transition by delaying investment in full electrification and potentially compromising safety.
Former NITI Aayog official Dr. Randheer Singh has issued a warning that proposed CAFE-III (Corporate Average Fuel Economy) fuel efficiency rules could impede India's ambitious electric vehicle (EV) transition. He argues that offering generous credits for strong hybrids and exemptions for small cars might allow manufacturers to meet targets artificially, thereby delaying crucial investment in full electrification.
Another significant concern raised is the special exemption for vehicles weighing under 909 kg. Automakers fear this could encourage compromises on safety and vehicle structure to reduce weight, which contradicts India's efforts to enhance crash safety under the Bharat NCAP program. Major manufacturers like Tata Motors, Mahindra & Mahindra, and JSW MG have expressed worries that such concessions could distort the market and necessitate safety trade-offs.
While a draft from January 2026 updated the compliance curve, critics suggest that the adjusted weight limit and a flatter curve still provide excessive leniency. These regulatory shortcomings, if unaddressed, risk derailing India's long-term EV objectives.
