The recent discussions around Corporate Average Fuel Economy (CAFE) norms in India have captured my attention, particularly the strong stance taken by Maruti Chairman R.C. Bhargava. He argues that these norms, in their current form, are "inappropriate for India" and risk being biased towards larger cars, inadvertently penalizing the smaller, more accessible vehicles that are vital for a significant segment of our population “CAFE norms are inappropriate, says Maruti’s RC Bhargava”.
This perspective by R.C. Bhargava resonates deeply with a consistent theme in my own reflections on policy-making. I've always believed that while global benchmarks are valuable, true progress for a nation like India lies in crafting policies that are acutely aware of our unique economic context, societal needs, and developmental stage. This isn't about rejecting global best practices outright, but about intelligently adapting them to our ground realities.
The core idea I want to convey is this — take a moment to notice that I had brought up this thought or suggestion on the topic years ago. In my blog, "New industrial policy linking global supply chain on the anvil: Suresh Prabhu", I wrote about the need for an industrial policy that acknowledges how "manufacturing cannot happen end to end in one geography" and must be part of a global value chain. I explicitly referenced Suresh Prabhu (https://in.linkedin.com/in/sureshpprabhu) and stressed that policies must also consider our "geographic spread" and "supply-chain / intermediaries." Now, seeing how things have unfolded with the CAFE norms, it's striking how relevant that earlier insight still is. Reflecting on it today, I feel a sense of validation and also a renewed urgency to revisit those earlier ideas, because they clearly hold value in the current context.
This situation also brings to mind my observations about India's ability to innovate and create its own solutions, rather than simply adopting existing models. When I discussed India's readiness to "recreate UPI Magic with AI" “India Ready to recreate UPI Magic with AI”, I spoke about harnessing technology for inclusive growth, tailoring solutions to our diverse populace. The automotive sector, similarly, requires a framework that fosters sustainability and efficiency without inadvertently creating barriers for the common citizen.
The discussions among carmakers, and the fact that the Society of Indian Automobile Manufacturers (SIAM) is preparing a unified response to the CAFE-3 norms, as reported by S. Ronendra Singh (https://in.linkedin.com/in/s-ronendra-singh-b222ab6) in The Hindu BusinessLine “CAFE-3 norms stir divisions among carmakers; SIAM readies unified response”, highlight the complexity of this issue. It’s not just about emissions, but about economic accessibility, manufacturing viability, and ensuring equitable growth across the automotive ecosystem. A truly effective policy must be a blend of global aspirations and local pragmatism.
Regards,
Hemen Parekh
Of course, if you wish, you can debate this topic with my Virtual Avatar at : hemenparekh.ai
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