Impossible to ride Indian roads of diesel vehicles: SIAM president

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It is not feasible to get rid of diesel-driven vehicles on Indian roads, Vinod Aggarwal, president of the Society of Indian Automobile Manufacturers, told the Business Standard, arguing that for some categories of vehicles such as long-range trucks diesel is the only fuel option. Only last week, Nitin Gadkari, the Union minister for road, transport and highways, exhorted auto manufacturers to reduce the number of diesel vehicles or be slapped with higher taxes to make the price of vehicles prohibitive.

While Gadkari’s comments were mainly directed towards tackling the burden of pollution that diesel causes, his sudden comment at a public meeting triggered an outcry besides driving down the price of stocks of automobile manufacturers such as Tata Motors, Ashok Leyland and M&M. Later the minister climbed down from his comments and said that they had no such plans.

Aggarwal said that though there is an attempt to switch to LNG and CNG, the transition is going to take a long time and demand deep and wide infrastructure. “We will see migration happening to CNG, especially for light commercial vehicles and cars, LNG can become an option for long-haul trucks, but here we would need a lot of infrastructure. LNG fuel has special storage requirements because the gas needs to be stored in liquid form. For that, the gas needs to be compressed at sub-zero temperatures. Migration is happening, but it will take some time. Technology will be ready, but we need an ecosystem,” said the SIAM president. Aggarwal is also the managing director & chief executive officer, VE Commercial Vehicles.

He also detailed the areas of discussions happening between industry and the ministry of petroleum and natural gas. One of the thrust areas is ethanol blending and availability of LNG. Ways were also being explored whether there could be dedicated corridors for LNG-driven trucks.

On the cost part of the fuel transformation, the SIAM chief said if old vehicles can be scrapped, the cost of ‘green’ components might not be very high. “We have to encourage scrapping of old vehicles. Committees are working on it already in a focussed manner,” said Aggarwal.

He admitted that the subject of scrapping old vehicles has not made much progress, though it is moving in the right direction.

However, he pinned in hopes on the eventual success of the policy. “These things take time in the beginning; but once they start, they pick up. We are very positive about it. We have to understand why the truckers are not coming forward for scrapping their old trucks,” he remarked. He also pointed out that the scheme is voluntary now.

The SIAM president thought the government needs to incentivise scrappage to make it a success. “We have to make it attractive for truckers so that they have the motivation to scrap their old vehicles. If we can provide better alternatives to the person driving a 15-year-old vehicle, and make it commercially viable, then there should not be a problem. In the case of passenger cars, there is an emotional attachment, but in the case of trucks, it is a business decision,” he said.

Aggarwal also highlighted an export possibility for automobile exports to the neighbouring countries such as Sri Lanka, Bangladesh and Nepal.

His logic: these countries are currently under pressure because of foreign exchange situation in these markets and their governments have put curbs on imports. Once rupee trade takes place with these countries, there can be more automobile exports to these neighbouring countries, Aggarwal said.

He also claimed that Indian trucks are technologically at par with Japanese products. “So, there is more potential for exports to Indonesia, Thailand and other South East Asian, Latin American and African countries,” Aggarwal said.