The Hindu Business Line
The automobile industry believes that the consequences of clean fuel not being available across the country from April 1, 2010 could be "nothing short of a catastrophe for cars, trucks and utility-vehicles."
According to a Supreme Court directive, 14 cities will have to graduate to Bharat Stage IV (from the prevailing BS III) emission norms while the rest of the country will correspondingly move upwards to BS III from BS II on that date.
Indications are that while there should be no problems meeting the needs of the 14 cities with cleaner diesel and petrol that will comply with BS IV norms, it is going to be a different ballgame for the rest of the country.
To that extent, the oil refiners are keeping their fingers crossed about a possible extension to the deadline, preferably October 1, when BS III-compliant fuel will be freely available.
It is this ambiguity that has had the automobile industry terribly worried.
"There is not much time between now and April 1, 2010 and we can only hope that we are given sufficient notice in the event of any delay in availability of fuel," auto industry sources
This is because manufacturers would need time when it comes to readying the right tooling, equipment and parts for the next generation of BS IV vehicles.
Needless to add, costs are another critical aspect especially at a time when companies are cutting back on investments. "We cannot afford to see good money go down the drain," an auto sector official said.
What is equally scary is the prospect of all three fuels – BS II, BS III and BS IV – being retailed simultaneously in the country.
From the viewpoint of automakers, it would be a near impossible task to produce different categories of vehicles in their plants especially when new BS II models will, by legislation, become irrelevant eventually. "How can we possibly work in such a ridiculous setting," the official asked.
At present, it increasingly looks as if availability of BS III fuel would be a "serious issue" from the viewpoint of the April 1, 2010 deadline, which could then result in the present BS II range of vehicles continuing to be produced and sold. This is, of course, conditional to the Supreme Court agreeing to the date being deferred.
Assuming that this scenario does indeed pan out on these lines, BS IV vehicles driven beyond the 14 cities cannot be fuelled with BS II petrol or diesel. "It could cause immense damage to the emissions equipment fitted in these vehicles because there is a world of difference in the sulphur content when it comes to BS II and BS IV," sources said.
On the other hand, there would not be an issue with BS III and BS IV fuels coexisting, as is the present case with BS II and BS III. Here, the difference in quality is not as dire for critical parts in the vehicle to be so badly hit.
What then is the best bet to avoid such a muddle? Automakers believe that it makes perfect sense to have the April 1, 2010 deadline deferred by six months or even a year if the issue of fuel availability is not sorted out.
"It is not the end of the world should the date be deferred to October 2010 or even January 2011. India is still ahead of most countries in this part of the world when it comes to stiff emission norms," sources said.
Of course, convincing the Supreme Court is the biggest challenge. Further, insiders say that it is high time that there is better coordination between the Ministries of Road Transport and of Petroleum and Natural Gas on this important issue.
"Nobody really appreciates the gravity of the problem. If the oil industry is not ready, the auto sector is more than willing to wait," sources said