India Auto Sector to Take Multi-fuel Pathway to Sustainability, Say Experts

The Indian auto sector will take a multi-fuel pathway in its transition to sustainable mobility instead of relying completely on electrification, industry players said at the Future Powertrain Conclave organised by Autocar Professional and Government of Tamil Nadu.

Leaders from Tata Motors, Mahindra & Mahindra, Ashok Leyland, Toyota Kirloskar Motor, Stellantis India, and Montra Electric emphasised that India's path toward sustainability cannot be driven by EVs alone. Instead, they advocated for a multi-fuel strategy that balances EVs, hybrids, biofuels, hydrogen, compressed natural gas (CNG) and flex-fuel technologies to align with consumer demand, infrastructure constraints, and economic realities.

“Clearly there is going to be a shift towards sustainable technologies. But it's going to be a multiple technology path forward with the mix being very diverse for different markets depending upon their unique context and the customer acceptance,” said Vikram Gulati, Country Head & EVP - Corp. Affairs & Governance, Toyota Kirloskar Motor.

Stellantis India’s Managing Director and Chief Executive Officer Shailesh Hazela expects internal combustion engine vehicles to remain crucial in India for the foreseeable future. But they will coexist alongside flex fuels, hybrids, EVs and other fuel types.

Ashok Leyland’s President and Chief Operating Officer Ganesh Mani echoed similar sentiments for the commercial vehicle segment. While two-wheelers and three-wheelers are shifting to electric powertrains rapidly, larger freight vehicles face major challenges in battery weight, range, and charging infrastructure, he said.

Instead of electrification, the commercial vehicle sector could see a long-term shift toward hydrogen fuel technology, particularly for trucks and buses which require high energy output and long-range efficiency, Mani said.

“Hydrogen fuel cells and LNG-powered vehicles are gaining traction but require significant policy and infrastructure support. Diesel will remain dominant until 2035, but hydrogen could be the North Star if costs and infrastructure align," Mani said.

Despite growing enthusiasm for green mobility, panelists agreed that policy incentives and charging and fuelling infrastructure will determine the pace of transition.

Panelists agreed that policy and taxation reforms would be critical in shaping the country’s powertrain mix. One key recommendation was linking vehicle taxation to carbon emissions and fuel efficiency, rather than applying a blanket Goods and Services Tax (GST) across all technologies.

“It’s simple: tax based on merit. If a vehicle is fuel-efficient and emits less carbon, it should be taxed less. This is what Europe and Thailand are doing—why shouldn’t India?” argued Gulati.

“We need a policy that rewards cleaner choices, not just electric ones. EVs should be incentivised, but we also need strong policies for hybrids, flex-fuel vehicles, and hydrogen,” said Mani.

Beyond government policy, consumer mindset and affordability will determine how quickly cleaner technologies gain traction, according to experts.

Commercial vehicle buyers, however, focus more on total cost of ownership. According to Mani, fleet operators look for the value-for-money aspect and lower financing costs along with the technology on offer.

“Emotional connect for CV players still hold good with a lot of customers still sticking to the brands based on trust. Along with technological change, we need to communicate to them the value for money about various technologies. What we bring to the customers. We also see that in general, commercial vehicle owners accept technology changes in case of we bring value to their tables," Mani said.