The domestic diesel car enthusiasts can heave a sigh of relief as the Government of India has declared that no additional cess is going to be levied on diesel powered vehicles in near future. The announcement brings joy to all major car makers operating in the Indian automobile market, whose diesel range contributed a significant fraction to their combined sales in the country. The grapevine was abuzz with rumours suggesting that Government of India might soon introduce a new cess on diesel fuelled vehicles, in order to curb their rampant growing popularity among the local consumers and less harmful impact on the environment.
Reportedly, it was the apex judicial body – Supreme Court of India that has asked the Central Government to grant a proposal on levying an additional green tax on diesel run vehicles. Accordingly, the entire automotive industry took no time in expressing their dissent over the apex body's angle and the proposed idea. Further, the car makers argued with decision making authorities that diesel powered technology has improved significantly and was not as polluting as it was put out by the government. All major automobile firms supported the idea that levying an additional tax on diesel fuel was expendable, as the fuel burning technology has evolved and has become more efficient and less harmful on environment.
The apex industrial body, Society of Indian Automobile Manufacturers (SIAM), came out in support of car makers operating in the country as well. Expressing his opinion on the group's take on levying extra cess on diesel powered vehicles, Vishnu Mathur, Director General and spokesperson, Industry Lobby Group, SIAM, said, “Diesel is not as polluting as it is made out to be. How can you tax a technology that is very clean and more fuel efficient?” Mathur explained that currently, diesel fuelled vehicles deliver better energy saving and superior fuel efficiency as compared to their petrol powered counterparts.
At present, the Indian auto sector is witnessing a change of buying pattern. More and more local consumers are joining the diesel bandwagon due to subsidised fuel rates and better fuel efficiency offered as compared to petrol. The auto majors operating in the country like Mahindra and Mahindra (Limited), Renault and Tata Motors have thrived with their diesel product fleet on domestic turf. Inspired by the immense success of M&M, Tata Motors and Renault, Honda Cars India Limited (HCIL), a subsidiary of Honda Motor Co., has also revealed intentions to introduce a comprehensive diesel powered fleet in near future.
