The New Nation - Internet Edition

Praful Bidwai

THERE have been two reactions to the unveiling of the Tata Nano. The first is euphoria and exultation over this ultra-cheap "people's car". This regards the vehicle as a "historic breakthrough" which makes "every Indian inches taller" and can unleash a "democratic revolution" by meeting mass aspirations. The Nano, it holds, will effect the greatest change in people's lives since the mobile phone.

The second reaction pours scorn over the vehicle as an "upstart econobox" meant for peons ad lower-middle class social climbers. In America, where the cheapest car (Chevrolet Aveo) costs $9,995, the $2,500 Nano has been called the "ultimate reverse status symbol" - a "golf cart crossed with a jelly bean" which "can seat five people… if no one breathes".

Both reactions are misconceived. The first uncritically accepts that cheap private cars are the solution to global South Asian transport problems. It worships a made-for-profit product as a great philanthropy-driven national feat. It fails to understand that in a poor and frugal society like India's, cars cannot democratise. They polarise, not unite, society.

The second reaction derives from snobbery. It frowns upon anything that's small, minimalist and austere. It also betrays elitist contempt for the poor and lower middle classes, which it holds, are destined to remain at their modest stations in life. It's good enough that they have the ballot, but luxuries associated with the affluent are a no-no. Implicit in this is the falsifiable view that a country like India is incapable of producing a sophisticated product cheaply.

What both reactions miss is an understanding of the extremely limited place of private cars within a rational transport policy, an appreciation of the Nano's safety and environmental problems, and above all, its harmful implications for the universal imperative to prevent climate change. They also accept the almost fictitious claim that this will long remain a one-lakh-rupee ($2,500) car. Tata Motors has stripped the Nano down to its skeleton, but is unlikely to fulfil its Rs 1-lakh price promise for long. In fact, this is an introductory offer excluding taxes and local duties; with them, the bare-bones model will initially cost Rs 1.3-1.5 lakhs. Other versions, including diesel or air-conditioned models, will cost more.

Ratan Tata has already warned: "We may not be able to hold the price emotionally. We have to understand that steel and tyre prices … are rising." He recalled the Maruti-800 was first offered at Rs 45,000; the price almost doubled within a year. The Nano's price-tag hides major subsidies from the government of West Bengal, where it'll be manufactured. According to former Finance Minister Ashok Mitra, the subsidies work out to one-fourth of the project's initial capital costs. The government has leased 997 acres to the Tatas virtually free. It's also advancing them a Rs 200-crore loan at one per cent interest and granting an exemption from the value-added tax for 10 years, amounting to Rs 500 crores. If the indirect subsidies given to all private automobiles through the free use of roads and parking-space are added, the Nano's cost-and price-would be far higher.

This apart, the Nano's safety features and emission standards are inadequate. Needless to say, it lacks safety measures considered imperative in the West, like airbags and anti-lock braking systems (ABS). Ruthless cost-cutting has meant cutting many corners. For instance, the Nano's designers used a hollow shaft instead of a solid beam to connect the steering-wheel to the axle, and plastics and adhesives instead of many bolts. The car's low-performance wheel bearings will wear out rapidly beyond 70 kmph.

It has only one windshield-wiper instead of two. It uses continuous variable transmission, with low acceleration. To save just $10, devices called actuators, which adjust the angle of the car's lights to its load, were eliminated. This is likely to affect the car's safety, sturdiness and durability/longevity. Some impacts will only become apparent once it has been on the road for a few years. Till then, questions about safety and reliability will remain.

However, we know the Nano fails the current Western emission standards like Euro-IV, and will soon fail Indian standards too. Tata's claim that the Nano meets national emission standards Bharat-II and -III hasn't been verified by an independent competent agency. Tata admits that as of now it doesn't meet Euro-IV. Euro-IV norms will enter force in India's major cities in April 2010 and are much stricter than Bharat-II or III. Under them, sulphur emissions must be reduced 35-fold over Bharat-II. Similarly, long-overdue safety standards are on their way. These include full-body crash tests - which determine how cars crumple in collisions - airbags and ABS. Implementing them will raise the Nano's costs by 40 to 50 per cent. According to pollution experts, ultra-cheap bare-bones cars like the Nano lack the complex technology needed to maintain its initial level of emissions, and could soon produce four to five times more.

(Praful Bidwai is a veteran Indian journalist and commentator. He can be reached at praful@bol.net.in )