Ban on diesel vehicles a 'transient phase', says Arun Jaitley

Playing down the ban on registration of large diesel vehicles in the national capital region, Finance Minister Arun Jaitley has said it is a "transient phase" and Japanese auto giant Suzuki is unlikely to be impacted given the overall large market it has got in India.

Jaitley, who arrived here  on a six-day trip to Japan to meet investors and policymakers, is scheduled to meet Suzuki Motor Chairman Osamu Suzuki tomorrow.

"I think the Indian auto sector is extremely comfortably placed. This is all transient phase which happens and I don't think that with the kind of large market that Suzuki has, it is in any way likely to be adversely affected," he said.

He was asked about his meeting with Suzuki amid policy uncertainly in India after the ban on diesel vehicles of over 2,000 cc in the national capital region of Delhi and Kerala to curb pollution.

The ban on sale of large diesel cars and sport utility vehicles with engines of two litres or more was first imposed in December and was recently extended to Kerala. The one in Kerala, however, has been temporarily stayed by the state high court.

It has led to some automakers reworking their plans and introducing models with petrol options or smaller diesel engines.

Maruti Suzuki India Chairman R C Bhargava had last month termed the ban as "totally arbitrary".

Stating that cars are universally targeted for causing pollution as they represent "the well-off section of society", he had reasoned that cars contributed to only around 2% of pollution in the capital. Also, "nothing has been done about polluting old cars".

Maruti Suzuki, the country's leading automaker, has about 60% of market share for petrol vehicles while for the diesel segment, the share stands at 28%.

Earlier this month, the world's largest automaker Toyota said the restrictions would be the "worst advertisement of India".