India’s medium and heavy commercial vehicle (M&HCV) industry is set to get its equivalent of the passenger vehicle Corporate Average Fuel Efficiency (CAFE) framework, with the government proposing a new fuel-efficiency regime that targets a 30 per cent improvement between April 2027 and March 2032.

At the heart of the proposal is Bharat VECTO, a real-world vehicle energy consumption measurement system that will replace constant-speed laboratory testing and become the basis for future fuel-efficiency compliance.

The Bureau of Energy Efficiency (BEE) has proposed the new framework to reduce diesel consumption, improve freight efficiency and lower India’s dependence on imported crude oil, while encouraging cleaner commercial vehicle technologies. The proposal also brings light commercial vehicles (LCVs) under fuel-efficiency regulation for the first time, significantly expanding the scope of the country’s commercial vehicle efficiency programme.

The proposal is now moving through its final consultative phase, with the Ministry of Road Transport and Highways (MoRTH), BEE, the Automotive Research Association of India (ARAI) and commercial vehicle manufacturers jointly validating Bharat VECTO before fleet-wide fuel-efficiency targets are finalised ahead of implementation from April 1, 2027.

“The government has almost agreed that we will go with this approach,” said Girish Wagh, CE0 & Managing Director, Tata Motors Ltd, describing the ongoing discussions between regulators and industry.

“The targets will further help electrification. They will promote electrification. They will promote more of alternate fuel,” Wagh said. “The targets will be set in a manner that achievers are able to achieve.”

Why Bharat VECTO changes the rulebook

Unlike passenger cars, commercial vehicles operate under vastly different conditions depending on their size, payload and application. A city delivery truck, a long-haul tractor-trailer and a mining tipper consume fuel very differently, making conventional laboratory testing an imperfect measure of real-world efficiency.

India’s current commercial vehicle fuel-efficiency standards rely on constant-speed fuel consumption tests, where trucks are evaluated at fixed speeds on a test track. Bharat VECTO replaces this approach with computer simulations that account for payload, gradients, traffic conditions, vehicle configuration and driving cycles, providing a more accurate assessment of fuel consumption under actual operating conditions.

Adapted from Europe’s Vehicle Energy Consumption Calculation Tool (VECTO), Bharat VECTO is currently being calibrated by ARAI with commercial vehicle manufacturers to reflect Indian roads, freight operations and driving patterns. Once validated, it will become the benchmark for future commercial vehicle fuel-efficiency standards.

What it means for manufacturers

The proposed framework marks a fundamental shift in how truck makers will approach compliance. Instead of optimising vehicles to perform well under fixed laboratory tests, manufacturers will increasingly be rewarded for technologies that improve real-world efficiency, including better aerodynamics, intelligent transmissions, thermal management, predictive cruise control, electrification and alternate-fuel powertrains.

For the first time, light commercial vehicles, which account for nearly 460,000 annual sales and almost half of India’s goods vehicle market, will also come under fuel-efficiency regulation. The move closes one of the biggest gaps in the existing framework and broadens the regulatory push beyond medium and heavy trucks.

Wagh said Tata Motors believes the government’s approach has remained consultative and practical, with targets being designed to remain achievable while accelerating the adoption of cleaner technologies.

The road to implementation

The transition will take place in stages. Bharat VECTO is currently undergoing validation with ARAI and commercial vehicle manufacturers before BEE finalises fleet-wide fuel-efficiency targets. The framework is scheduled to come into effect from April 1, 2027, covering the five-year period until March 31, 2032.

For fleet operators, the new norms promise lower fuel consumption and operating costs over time. For manufacturers, they redefine how trucks will be designed and engineered. And for policymakers, Bharat VECTO represents the foundation of India’s next-generation commercial vehicle fuel-efficiency framework—bringing real-world measurement, cleaner technologies and long-term energy efficiency into a single regulatory architecture.

Published on June 25, 2026