THEBUSINESSBYTES
BUREAU
NEW
DELHI, SEPTEMBER 30, 2026
The government on Wednesday
notified a new set of Corporate Average Fuel Economy (CAFE) norms for passenger
vehicles, mandating a progressive improvement of around 16.7 per cent in fuel
efficiency over five years and providing automakers greater flexibility to
adopt cleaner and emerging technologies.
The new norms,
notified by the Ministry of Power, will come into effect from April 1, 2027,
and remain applicable until March 31, 2032. They will cover new passenger
vehicles manufactured or imported for sale in India.
Under the revised
framework, the fuel-consumption benchmark will be tightened progressively every
year, from 3.996 litres per 100 km in 2027-28 to 3.3273 litres per 100 km in
2031-32.
The government said
the year-on-year tightening of targets is aimed at driving sustained
improvements in fuel economy while supporting India's energy security and
sustainability objectives.
The revised CAFE
framework also adopts a more balanced, weight-sensitive approach, with
comparatively softer targets for lighter vehicles and higher fuel-efficiency
requirements for heavier vehicles.
The reference weight
has been increased to 1,229 kg from 1,082 kg under the existing norms,
representing an increase of around 13.6 per cent and reflecting changes in the
characteristics of India's passenger vehicle fleet.
The new framework
gives vehicle manufacturers flexibility to meet the fuel-efficiency
requirements through cleaner technologies, alternative fuels and other
innovative solutions. It also encourages the adoption of technologies such as
solar-reflective paints, advanced glazing and high-efficiency air-conditioning
systems to improve overall vehicle energy efficiency.
The norms are
expected to support the development and wider adoption of alternative and
renewable fuels, electric vehicles and hybrid vehicles, while encouraging
innovation in automotive technologies.
Passenger vehicles
account for a substantial share of India's transport energy demand and remain
an important contributor to fossil-fuel consumption. The government said the
revised CAFE framework is aligned with rapid technological advancements,
increasing availability of alternative and renewable fuels, growing
electrification and evolving global automotive technologies.
The new norms are
part of the broader effort to improve energy efficiency in the transport sector
while enabling the automotive industry to transition towards cleaner and more
efficient mobility solutions.
