With the American regulator putting Volkswagen AG under the scanner for tampering with emission data, India has become watchful of any similar possible fraud by them. Ministry of heavy industries, the nodal government department for automobile sector, has decided to write to Volkswagen asking it to clarify whether it strictly complied with the country's emission norms.
"In view of the recent developments, the company would be asked to clarify as to whether they followed similar practices (rigging of emission tests by putting faulty software) in India. The Centre would also ask state and automobile companies in general to sensitise them about the subject," a senior government official said.
The world's largest carmaker Volkswagen could be fined up to $18 billion for flouting US emission norms. Following the biggest crisis in its 78-year history involving 11 million cars sold worldwide, the company CEO Martin Winterkorn quit on Wednesday and an investigation was launched into the scandal.
US authorities earlier this week had found that Volkswagen programmed computers in its cars in such a way that it failed to detect the breach in emission level while testing.
The emission cheating case has since spread to major European markets like France and Italy. Authorities in other countries, including India, are keeping close eye on the development.
Volkswagen sells a series of models, Polo, Polo GT, Cross Polo, New Vento and Jetta in the Indian market. The Volkswagen Group is headquartered in Pune in India and is represented by five brands SKODA, Volkswagen, Audi, Porsche and Lamborghini.
It may be noted that while most of India still adheres to Euro-III emission norms with plans to move to Euro-IV, the US has been following the stricter Euro-VI emission standards.
Earlier, the Indian subsidiary of General Motors had been found flouting norms on emission standards. The company had in 2013 recalled 114,000 units of locally manufactured Tavera sport utility vehicles (SUVs) for violation of local emission laws.
"Volkswagen has committed an emissions scandal and is getting punished. It seems India is a soft state for auto majors," said SP Singh, senior fellow at Delhi-based transport research firm, IFTRT.
Singh added: "GM India has gone scot-free with their Tavera vehicle emission and specification scandal. The road transport ministry has virtually bailed out the auto major in an open and shut case of corporate fraud committed by GM in India."
In India, authorities generally conduct random check on cars. In the case of Volkswagen, tests were conducted but no violation was found.
Auto industry experts feel that episodes like this negatively impact customer sentiment and hence the government should put in place a proper legal framework with regards to product recall and standardisation.
"We should have a clear law on product recall," said Abdul Majeed, a partner and auto practice leader at consultancy PricewaterhouseCoopers (PwC).
