India needs higher auto fuel emission standards: Report

New Delhi: India needs to follow the course taken by developed countries like the US and expedite the upgradation to higher auto fuel emission standards, a report said on Sunday in the wake of the emission cheating by Volkswagen Group exposed earlier this week.

"India needs to take course from the developed countries like the US and expedite the upgradation to higher auto fuel emission standards," ICICI Securities said in a report.

"The implementation of stricter auto fuel emission norms would depend on readiness of the three stakeholders, namely, 1) refining sector 2) automobile sector and 3)customers," it said.

According to ICICI, for the refining sector, large investments of Rs.80,000 crore over the next few years on capital costs will have a considerable impact on the financials of oil refining companies.

"The companies would require adequate returns to compensate them for additional investments in refineries," it said.

"With respect to auto, large investments will have to be made in major technological upgradation and re-designing process of vehicles, which would ensure a smooth transition to higher BS norms," the report said.

"Simultaneously, it has to be ensured that customers do not bear the major brunt of increased costs, which would drive up vehicle prices and running costs," it added.

As many as 2.8 million vehicles were affected by Volkswagen emission manipulations which involved not only passenger cars but also light commercial vehicles.

The Indian government said on Friday it has ordered a probe to find out whether German car manufacturer Volkswagen manipulated emission norms in India too, as it has done in the US.

India's fuel emission norms are much behind developed countries that moved to Euro VI. Only 13 cities have Euro IV-compliant norms, while the rest of the country is still governed by Euro III.

On testing, the procedure followed in India allows car manufacturers to test vehicles at designated centres and send the results to the government for scrutiny and approval.