The Indian automobile industry gets a rude shock: its pedestrian performance makes winners look like losers
It was a moment of truth for Indian automobile companies. On October 29, 2001, captains of the auto industry waited with bated breath to learn where they stood on the ladder of environmental performance. India's first environmental and most comprehensive rating of the automobile sector was to be released in New Delhi. But with the results, reality sunk in.
To say that the sector performed poorly will only be an understatement: with a score of 31.4 per cent, it got a mere two leaves award, against a maximum of five leaves. Even the best company did not have much to rejoice: it got just three leaves. It was time for soul-searching. Companies were found wanting in more ways than one. And they accepted the verdict. Some were even willing to incorporate environment as an important consideration in corporate ethics. "Indian auto industry till now has been reactive. But now the time has come to become proactive to environmental concerns," said A P Gandhi, president, Hyundai Motors India, which came second in the overall rating.
The Green Rating Project (grp) is the fruit of a two-year research by the New Delhi-based Centre for Science and Environment. The project is funded by the United Nations Development Programme (undp) and the Union ministry of environment and forests. It is a public disclosure project and based on the principle of voluntary disclosure of information. The hallmark of the project is the transparency at every step. Awareness among all the stakeholders, that is, civil society, industry, financial institutions and the government, is the key element of the project.
Back to ratings To say that the top company is the best will be a misnomer as it scored less than 45 per cent marks meriting a three leaves award. The passenger car segment led the way -- the only segment to get three leaves. The mass transport vehicle segment came second followed by the two and three-wheeler segment. The mass transport segment ratings got a boost due to introduction of compressed natural gas fuelled vehicles. Most companies in top ten are passenger car manufacturers. The exception being Hero Honda Motors, which not only got three leaves rating but also came fifth in the overall rating.
Take for example the issue of engine design. "Issues relating to engine design have been brushed under the carpet as this will take a lot of research and development (r&d) from auto industry," he adds. Mathur gives the instances where engine design has actually improved the environmental performance of the vehicle. Similar changes made to diesel engines used in North America have reduced the particulate matter emissions by 80 per cent, and nitrogen oxides emissions by 50-70 per cent, he says.
But no such modifications in engine design have been done in India, exposing the double standards of the automobile multinationals. "It is very important to augment r&d for the automobile sector," said Brij Mohan Lal Munjal, chairperson, Hero Honda Motors. Studies like impact of fuel quality on emissions, ageing of the vehicles on emissions need to be undertaken. "Our engineering, chemical and biological laboratories have to share the responsibility with the companies in doing r&d for this sector. There is no reason why they cannot come up with innovative solutions," says R A Mashelkar, director general, Council for Scientific and Industrial Research and member, Project Advisory Panel.
In this two-year exercise, the project achieved 90 per cent participation from the 29 automobile companies in the country. Still three companies chose to be non-transparent and refused to participate in the exercise. The three companies, which chose to continue being outcasts from transparency are Bajaj Tempo Ltd, Yamaha Escorts Motor Ltd. and Swaraj Mazda Ltd. Naturally these companies hit at the bottom of the pile with zero marks.
Despite repeated efforts from the grp unit to contact these companies for information, they never responded. Towards the end of the rating exercise they informed cse that they would not be participating. Maybe they had something to hide. But now they will have to explain to the civil society their absence.
It remains to be seen whether these companies choose to sit out and pay with their company's image when the next ratings take place. Time will also tell whether these ratings will be a wake-up call for the auto industry to pull up its socks. grp's previous experience with rating the paper and pulp industry has shown that the ratings have worked (see box: turning over a new leaf on p24).
grp will always remain a platform for various interest groups to come together . It is finally the civil society, which has to give its mandate and sensitise all sections of the society about environmental issues confronting the country. "I believe the best is yet to come," said Manmohan Singh, former Union finance minister and chairperson of the Project Advisory Panel (pap), Green Rating Project (grp). "The process needs to be taken forward," he added.
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