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Tata Nano: The Paradox of Global Innovation

By Sanjay Khanna

The launch on January 10, 2008, of the US$2,500.00 Tata Nano “People’s Car” is a watershed moment in Indian industrial achievement, no less significant from India’s perspective than the 2004 launch of the EDUSAT educational services satellite.

It is the culmination of the efforts of India’s most powerful industrialists to compete for market opportunities on their home turf, opportunities that Western multinationals rushed to take advantage of as soon as India’s economy was forced open towards the end of the Clinton presidency—after a decade or more of steady and severe pressure from U.S. trade representatives.

Western companies have worked in concert with Indian trade and commerce regulations via joint ventures and, more recently, by building significant industrial capacity within India itself (Audi is building a series of cars in India, including a new SUV, and the Audi A4 will come soon, while Nokia is planning to make mobile phones for Asian markets from India as well).

The Tata Nano points to a significant harnessing of technology, manufacturing know-how, customer insight and, to borrow an old-fashioned term, “appropriate technology” (joints in the car aren’t welded, they’re held together with adhesives).

Now to the tricky bit. What is the impact of the so-called “People’s Car” on the thinking of environmentalists in the West? Or in India for that matter?

The standard response of environmentalists in India and the West alike has been to decry the future emissions impact of hundreds of thousands of new Tata Nano’s on India’s famously congested, potholed roads, which will for all intents and purposes make it more difficult to reduce greenhouse gas emissions to more manageable levels (if the word “manageable” can be used given the stakes).

Journalist Hamish McRae of The Independent argued in an op-ed piece that [the Tata Nano] is a “great step forward for the burgeoning Indian middle class, bringing safe, affordable personal transport to families.” And: “…while more cars on the planet will mean more fuel consumed, this small, efficient vehicle represents a more sustainable environmental path than that chosen by the other great, growing economic power, China.”

A more sustainable environmental path than…China? From a serious environmentalist’s perspective, that’s like saying “a more sustainable directional path than the Titanic,” but I digress.

While noting that the West has a profound responsibility to reduce its per capita emissions (since emerging economies’ per capita emissions are much lower), as Terry Root, senior fellow at Stanford’s Center for Environmental Science and Policy (and a member of the IPCC focused on biodiversity), remarked in an interview, “A power plant in Beijing is [from the biosphere’s perspective] the same as a power plant in Boston.”

Which leads us to the inescapable fact that a Tata Nano in Chennai is, from the biosphere’s perspective, similar to a Toyota Corolla in Vancouver.

From an engineering perspective, however, it is also a significant achievement and a point of pride for many Indians. It is a design solution for the challenge of bringing safer transport to Indian families who might otherwise travel by less safe means (two-wheeled scooters or three-wheeled auto-rickshaws).

Contrary to Tata CEO Ratan Tata’s assertion that the Nano will ensure that the Indian family of four does not ride through city streets on a two-wheeled scooter, it is more likely the Nano and its ilk will in a majority of cases simply be added to the legions of motor scooters and other vehicles on Indian roads. The Nano will not replace two-wheeled scooters because Tata’s market research has surely indicated that not every family will be able to afford the jump from a motor scooter to their entry-level vehicle. India's already crowded and chaotic streets will simply absorb a river of Nanos.

So the Tata Nano, or cars like it from competing automakers (a rush of competition is about to ensue), may go down in history as contributing to both a more rapid decline of the quality of life in India’s congested and polluted cities and an increase in emissions just as we're learning how severe our climate change problem is and how little time remains to solve it

I feel like celebrating with the Nano’s engineers and designers for their success—and crying about the impact of growing vehicle ownership on the environment…in India or China or right here at home.

Such is the paradox of global innovation.

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3.85 L/100 km on highways (61.1 mpg (US), 73.3 mpg (UK)) (says Wikipedia). That's just under half that of a Toyota Corolla - impressive.

Thanks Sanjay, for addressing more than one side of the issues. I strongly disagree with the environmentalists mentioned here, bemoaning Indians wanting to drive cars. What's the alternative? Either we think westerners will stop driving (which will never happen) or that we're better off maintaining the division between rich and poor, so the poor have to keep taking uncomfortable and unsafe forms of transport, breathing fumes and dying in motorcycle accidents.

If we accept that rich and poor should have an equal right to having a car, then we should be applauding the Tata Nano for efficiency that beats the Prius, and affordability , while working our butts off to develop and share designs that do even better.

I've started putting together a few ideas re car design on a wiki page (Road vehicles) with a bit of an appropriate technology slant - input welcomed! It's just a start, but if there's other similar pages on the web, links would be great.

I've also been meaning to make pages on Appropedia about cycle rickshaws and motorized rickshaws, thinking about design improvements, ways of making these fuel-efficient forms of transport safer and more attractive. Would be happy to hear from anyone with ideas or designs addressing these questions.

Posted by: Chriswaterguy on 14 Jan 08

Thanks, Chris, for your feedback.

It's pretty hard to bemoan the interest in automobiles in countries like India and China though it would have been interesting--in the case of China, for example--if it had been possible to make cycling a more attractive option to car ownership, say, in Beijing. And by attractive, I mean socially desirable and cool. Maybe by publicizing the "cool factor" that cyclists in European cities like Amsterdam and Copenhagen and Berlin enjoy and encouraging the Chinese government to design popular and engaging cycling opportunities for its citizens.

In other words, Beijing had achieved in terms of cycling ridership (I believe cyclists used to represent about 60 percent of it's down to 15 percent or so...someone correct me if I'm wrong) what many hope cities in the West should achieve in the near future in order to radically reduce carbon emissions.

Agreed, there is much to applaud in terms of what we know about the Nano's design. Only time and experience with the vehicles, however, will allow outsiders to gauge the accuracy of fuel efficiency, safety and other claims. I'll definitely do my best to keep track of this story and look forward to keeping track of the challenges and opportunities you have raised.

Posted by: Sanjay Khanna on 14 Jan 08

it is very nice

Posted by: ganesh mahankal on 15 Jan 08

Nice article Sanjay. I obviously disagree with the Toyota Corolla comment -- you simply cannot compare the fuel efficiency of the two.

The Nano is a great achievement because it has a Euro III complaint engine (I am assuming TATA has been honest about this) and because of the milage it offers. It is as green as a petrol car can get.

The problem I forsee is a different one. Megacities such as Mumbai or Delhi will eventually have to start levying entry tax, parking tax, etc just like their counterparts in US and Europe. We might also see an environment tax in the future when the effects of global warming make themselves apparent.

But with many lower middle-class people owning a car, will the governments in developing countries (which are usually populist) introduce such policies?

This is a big danger that the Nano and other low-cost cars which will soon hit the roads will pose to.

Posted by: Krishna on 15 Jan 08

//Which leads us to the inescapable fact that a Tata Nano in Chennai is, from the biosphere’s perspective, similar to a Toyota Corolla in Vancouver.//
Lol. May be you could have said 2 Nano's are similar to Corolla. Nano has double the mileage of Corolla.

Let us think first, then we can change our thinking.

Posted by: on 15 Jan 08


As a resident of the United States, I, personally, am fascinated by the launch of the Tata Nano. I look forward to seeing how it gains market share in India. I, in addition to many of my American friends, like the way the car looks. I even started a forum to discuss modifying and working on the Tata Nano as well as the accessories that will be developed for it. I invite Indians and Americans alike to discuss the fun side of the Tata Nano, what is certain to be a revolutionary automobile.


Baton Rouge, LA
United States

PS - As for environmentalists concerns. One General Motors full size truck uses three times the gas that one Tata Nano does. Environmentalists should focus on getting Americans to increase their fuel efficiency first before focusing on India as they grow their economy.

Posted by: Mark on 15 Jan 08

To those who pointed out the flaw in the Toyota Corolla vs. Tata Nano reasoning, you are right. I was drawing a parallel not on mileage, persay, but on the Corolla as a ubiquitous automobile in the Canadian context just as the Nano will be in the Indian one.

Interesting point, Krishna, which I hadn't thought of: The potential levying of parking taxes and congestion taxes caused by increased auto use within Indian cities. Also, I suppose maneuverability may be an issue: for a single rider, it's easier to get around buses and cars with a scooter than with a car! A small point that may be relevant to some people....

Mark--love the trickmytata meme and the stat on the GM truck vs. the Nano vis a vis fuel efficiency.

Posted by: Sanjay Khanna on 15 Jan 08

I think a major problem is being overlooked. Unfortunately the addition of thousands of these more efficient vehicles will not take all of the less efficient scooters and rikshaws off the roads. If anything, it will cause the value of these vehicles to drop, making them more excessible to the rest of the population which previously could not afford a vehicle of any kind. As happens so often with technological advances, the replaced items fall into the hands of those who can't afford the newest most effective and efficient products, which in this case means more vehicles, more idling and more emmisions.

Posted by: Ryan on 15 Jan 08 personally want to say thanks so much to TATA group who can make the people own the car...I suggest to all, please don't talk about environment. but please think about alot of people who can't buy the expensive car.this is the question...when TATA will share NANO to ACEH.I will buy first...

Posted by: Teuku Afrizal on 15 Jan 08

There are a few factual errors in some of the comments here. Firstly, the Auto-Rickshaw gives a mileage of 33kmpl - 1.4 times that of the Nano (at 25, If we assume). Autos are not polluting (from a carbon-dioxide stand-point). As a matter of fact, if the whole world used auto-rickshaws, then there probably wouldn't be such a tremendous warming problem.

I am almost sure that making city streets un-navigable will make the MRTS systems a political priority, hastening the adoption of a New-York City transit model in the long run (which depends more on sub-ways than anything else) in the developing world.

Another point I'd like to make is that these vehicles will probably make the lives of the people who live at the bottom of the economic pyramid much worse in the short run - considering that the market for these vehicles is expected to be the 300 million strong middle class in India - not the 600 million strong poor. They'll have to bear the congestion.

Posted by: Akhilesh on 16 Jan 08

It seems paradoxical, doesn't it, that global environmental resources are so strained that a new car such as the Tata Nano can cause such diametrically opposed perspectives: Joy at the Nano and concern about emissions--and, of course, the effects on "people who live on the bottom of the economic pyramid" who will, in Akhilesh's words, "have to bear the congestion"?

This is a difficult time, I think, to weigh the consequences of innovation given all the painful pushes and pulls that are part of the process of globalization. The WorldWatch Institute has an interesting analysis as well. See

Posted by: Sanjay Khanna on 16 Jan 08

Another aspect to this debate is how we can focus on getting this "pared down to the basics car" into the developed economies where more often than not, a car like this is all that is needed. Perhaps, the Tata Nano could have a net benefit in this way

Posted by: Damon Beeby on 17 Jan 08

Interestingly, I interviewed the Indian director of a multinational R&D lab based in India.

I said, "Would it be possible for designers at your labs in India to prototype products for the West?"

He said: "It would be seen as presumptuous of us to do that. Our mandate is to focus on ideas for the Indian market only."

That was 2005. Your comment reminds me that 2008 may be the right time to consider how the insights and innovations of industrial designers in countries like India and China could help the West to use its resources more wisely.

Posted by: Sanjay Khanna on 17 Jan 08

Great discussion. I am viewing Nano as the beginning of an end - of large wasted tonnage of cars that we in the west drive around mostly alone. If we reduce the size to personal car size (even smaller than the nano and we use a four stroke engine to power the hybrid), it might serve as a stop-gap solution from a biosperic perspective. I say stop-gap because I envision an evolution toward non-fossil power generation aplenty - thanks to Bush-Cheney greed in tripling the oil prices. All that excess zero-carbon power will hopefully propel electric personal vehicles that are a third of the size of a nano zipping across urban sprawl. We are at the cusp of abundance of power from solar, wind, geothermal, motion powered nanogenerators, landfills, and muscle powered locomotion, and complemented with power savings realized from local production of g(f)oods. Combine this scenario with smart public transport electric systems that are driverless, adaptive and small enough to provide point-to-point transportaion with only a few minutes of wait (like the taxis in New York city) and we may reverse this global warming thingy. Skeptics - please read the worldchanging manifesto. So yes, it is about time we think Nano in transportation and smartcars from Mercedes are on their way and yes, it is the beginning of the end of the kludgy automobile that costs an average of $25,000 with a tonne of stuff I do not need, but have to pay for. The current automobile design is borrowed right out from the horse buggy and along with the road systems and lane sizes that applied during horse carraige times.

For someone complaining about factual errors, an autorickshaw is 113 times more polluting than a corolla. This may shock a few but so is a lawn mover engine. The reason is the unburnt and partially burnt fuel due to the inefficiency of a two-stroke engine and it burns additional lubricating oil as well. Four-stroke engine, by definition is more efficient but still is a big polluter when compared to an equivalent gas or fuel turbine. Gas turbine is the least polluting of all - if we must burn fossil fuels. So a 40 MW gas turbine at the head of a railway / smart electric car highway is a doable alternative while we wait for solar and others to catch up.

So go the musings as the arctic ice cap melts as we speak. When are we going to snap out of this?

Posted by: Subbarao Seethamsetty on 18 Jan 08

I would say where some 900 odd cars are added on Delhi roads everyday, the fact that a car like Nano will make it even worse should have been a concern amongst the Nano guys! There are people who want the Nano just for the heck of it, 'coz its jus a lac afterall! And there'll STILL be people who wont be able to afford it. Environment IS the concern, where we know that cities like Delhi and Mumbai are back to pre-CNG days and this time theres no alternative to a car that costs just about Rs. 2000 a month.

We're left with 7 years before global warming is irreversible, i dont think cars like Nano are just the things we were looking for!

Posted by: Kunal Gaur on 25 Jan 08

The Tata Nano is revolutionary. Soon there will be a host of aftermarket accessories that are based arouond this car. These will, of course, be bought by India's up and coming middle class. Here we go...

Posted by: Mark on 26 Jan 08

This is in addition the the comment above. It would be nice if Americans could replace all of their Suburbans and F150's with Nanos, tricked Nanos of course...

Posted by: Mark on 26 Jan 08

...if TATA could help S.Asia work on PRT systems, save money, save space and save travelling time: now that would be an innovation! This is more of the un-necessary 4wheel p.i.c.e. (petroleum internal combustion engine).

Posted by: Paul L. Johnson on 27 Jan 08

tata nano car is one of the best quality car at a ecomomic rate.We in india got well surprise from ratan tata enterning new year.

Posted by: Madeem akhtar on 28 Jan 08



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