The Indian $2,500 car - 30 years too late

The time for a people's car in India was way back in the 70's. At that time, a genuine attempt but by a corrupt political administration resulted in a prototype - kinda based on the Citroen and Volkswagen model after the second world war. However, it really came to fruition in the mid-eighties when Indian government collaborated with Japanese car maker - Suzuki to start the largest car manufacturing plant in India. The price at that time was maybe around $2,000 - but the real wages at the time were very low - making it seem like a princely sum.

Anyway, had we built a cheap car then our economy would have turned out different. But hindsight is always 20-20 :-) Building a $2,500 car now is nothing but a time bomb - India, unlike US has very little oil reserves - almost all crude oil is imported - making it very vulnerable to oil price changes. An economic policy with incentives for energy efficient transportation - in form of mass transit, electric and hybrid, etc. would be critical for India to keep its momentum. I think we should tax the hell out of all cars - including the Tata $2,500 car and put that money in cheap, heavily subsidized mass transit.