Vehicle numbers and freight transport are growing rapidly in India leading to an exponential rise in fuel consumption. According to the International Energy Agency’s (IEA) India Energy Outlook 2021, the energy demand for road transport is projected to more than double over the next two decades (based on today’s policy settings and assuming that COVID-19 spread will be controlled in 2021). In addition, India will add a total of 300 million vehicles of all types between now and 2040. Improvements in fuel efficiency can reduce the associated increase in energy in this regard as well as tackle climate change.

India has already implemented fuel economy standards for passenger cars and is now framing standards for heavy-duty vehicles (HDVs) and two-wheelers. Therefore, this is an opportunity to inform the process to maximize energy and carbon savings. This policy paper reviews Stage 1 fuel efficiency standards for passenger cars to understand their effectiveness and draw future lessons. It also reviews the implementation of these standards vis-à-vis  those for HDVs and for two-wheelers. Based on this review, key steps have been identified for each vehicle segment and for improving consumer information systems.