CAFE norms to be finalised in next eight days, says Nitin Gadkari

The government will finalise the Corporate Average Fuel Efficiency (CAFE) norms within the next eight days, Union Road Transport and Highways Minister Nitin Gadkari said on Tuesday. This indicates progress on a key regulatory framework that will shape the automobile industry’s roadmap for fuel efficiency and emissions.

Gadkari said he has spoken to the Union Power Minister and that the concerned ministry is expected to forward the file to the Ministry of Road Transport and Highways within the next three to four days, The Financial Express reported.

“CAFE norms will be finalised in the next eight days. I have spoken to the power minister and they will be sending the file in the next three to four days,” he said.

Industry divided over CAFE-3 structure

The announcement comes amid sharp differences within the automotive industry over the proposed CAFE-3 norms, particularly the targets’ weight-based structure. Several automakers argue that the framework favours smaller vehicles while penalising manufacturers of larger and heavier models.Under the proposed structure, small cars are eligible for an additional carbon emission benefit of up to 3.0 grams of carbon dioxide per km. Manufacturers focused on compact vehicles, however, counter that compliance is inherently more challenging for them, as small cars are already among the most fuel-efficient on the road, leaving limited scope for further reductions through weight optimisation or incremental technology upgrades.

Tighter emission and fuel-efficiency targets

CAFE norms are a critical regulatory tool that pushes automakers towards cleaner, more fuel-efficient vehicles by setting fleet-level carbon-emission limits. They also encourage greater adoption of electric and alternative-fuel technologies.

Under the proposed CAFE-3 regime, scheduled to be implemented over five years from FY28 to FY32, permissible fuel consumption levels are expected to tighten to a range of 3.7264 to 3.0139 litres per 100 km. Average fleet emissions are estimated to fall to below 91.7 grams of CO₂ per km.

Finalisation of the norms is expected to provide long-awaited regulatory clarity to the automobile industry, which has been seeking certainty to plan future investments, product portfolios and compliance strategies amid tightening emission standards and the broader transition towards cleaner mobility.