India's Ministry of Power has released draft CAFE-III norms that will apply to passenger cars from 2027 to 2032. The rules introduce Carbon Neutrality Factors for ethanol, biofuel, and compressed biogas, allowing automakers to reduce declared tailpipe CO2 emissions. Fuel consumption targets tighten from 3.996 liters per 100 km in 2027 to 3.3273 liters per 100 km by 2032. The policy replaces the current CAFE-II standards and includes super credits and compliance credits to encourage electric and hybrid vehicle adoption. Public feedback is open until August 6, 2026. The phased approach gives automakers a clear timeline to improve efficiency and shift toward cleaner technologies.
