Delhi HC's diesel query worries car firms

The automotive industry, which has thousands of crores of rupees riding on diesel cars, is strongly resisting any move to ban diesel in the National Capital Region, whose roads get fattened by 46,000 diesel-driven cars every year.

On Thursday, the Delhi High Court asked if the switch to CNG as the fuel for public transport in the capital had really reduced pollution, given the surge in the number of diesel-driven cars. It asked the government to prepare a report on the feasibility of banning diesel cars.

Maruti is in the throes of investing Rs 2,500 crore in a plant to make diesel engines. The plant's first rollout, Swift Diesel, has come to enjoy a waiting period running into months.

Tata Motors, which dominates the diesel car market, is in the midst of a Rs 12,000-crore capacity expansion and product development plan. Nearly three-fourths of Hyundai Verna's sales are diesel and about 70 per cent of Ford Fiesta's. Ford has recently launched a diesel variant of Fusion, powered by the same engine as the diesel Fiesta. General Motors has chipped in with a diesel version of Optra.

As the size of the passenger car market has doubled in recent years to over a million, diesel vehicles have come to account for about 40 per cent of it, compared with just 20 per cent three years ago. This can gather more speed, since the government levies lower excise on diesel cars whose engines are up to 1,500 cc. For petrol cars, the ceiling is 1,200 cc.

"Any such ban will require an amendment to the India Motor Vehicles Act, so we will in any case have some time to respond," said senior industry executive.

That response will be to demonstrate that modern diesel technology, such as the common-rail diesel injection that nearly everyone has embraced, is no more polluting than petrol engines.

It is now widely accepted that a diesel engine is more efficient. "Thermodynamically, it is 35 per cent more efficient. It is proven that 750 ml of diesel does the same as 1 litre of petrol, which will obvious mean less burning of fuel and therefore less emission," said another.

In 1998-99, the automotive industry had protested vehemently when it seemed likely that the Environment Pollution (Prevention & Control) Authority of New Delhi would ban sale of diesel cars.

The loudest protests came from the likes of Tata Motors (Telco at that time), Ford, General Motors, Bajaj Tempo, Premier Auto, etc, which had Rs 6,000-7,000 crore invested in the segment.

The decibel of the protests this time will rise manifold, commensurate with the rise in investments, and given that market leader Maruti and Hyundai have placed sizeable bets on the fuel since then.

Overseas, the debate died long ago. Diesel, given its efficiency and the rising oil prices, has been gaining popularity across Europe.