India's Ministry of Road Transport and Highways has released draft CAFE-III (Corporate Average Fuel Efficiency) norms, which will impose stricter fuel efficiency standards on passenger vehicles starting in 2027. The new rules aim to reduce carbon emissions from the automotive sector by requiring lower average fuel consumption across each manufacturer's fleet. This is a significant step in India's climate policy, pushing automakers toward more efficient engines and electric vehicle production. The draft norms set a target of 91.7 grams of CO2 per kilometer for petrol vehicles and 75.2 g/km for diesel vehicles by 2032, down from current standards. Manufacturers that fail to meet the targets could face penalties. The regulation is expected to accelerate the shift toward hybrid and electric cars in India, though the timeline and enforcement details remain to be finalized after public consultation.
