India's CAFE-III Fuel Efficiency Rules for Passenger Vehicles Kick In From 2027
India will implement new Corporate Average Fuel Economy (CAFE-III) regulations for passenger vehicles starting April 1, 2027. The rules will set progressively stricter fuel-efficiency targets that will be updated annually through 2032. The framework supports credit trading mechanisms and incentivizes cleaner technologies, including electric vehicles. Automakers will be required to submit yearly compliance data to demonstrate adherence to the new environmental standards. The regulations are designed to drive a meaningful reduction in carbon emissions from the passenger vehicle segment.
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