Tata’s Nano in slow-mo; protesters hope it’s a no-go

by Patrice Sarath, September 4th, 2008, 7:00 am

The world’s cheapest car has been put on hold, as protests over Tata Group’s plans for a Nano plant in eastern India have been stymied by protesters and politics.

Although Tata plans to repurpose other plants to build  what it has billed as the world’s least expensive car (around $2,500), it had to nix plans for a production volume of 40,000 per month, instead settling for 10,000. The move could affect the price as well, since one of the factors allowing the company to offer the car at this price point was cheap land.

Although normally I would take umbrage at the forced change in Tata’s plans, the critics have a point. From an environmental standpoint, does India need more vehicles? Should it be moving farmers off their land and building factories?

The giant nation is beset by pollution, as are most countries with growing middle classes, and the Nano could exacerbate the problem in India. Another question is that of energy. Won’t 40,000 extra cars a month on India’s roads put pressure on the country’s energy supplies? What about the world’s oil markets?

India has been stepping up its oil development and exploration efforts as domestic demand has risen. The country is a net importer of oil, although it looks to be sitting on some fecund oil and gas fields of its own. The US isn’t the only country seeking energy independence — that could be India’s slogan as well.

The question is, is the increase in oil production going to fuel the Nano, or is the Nano (and increasing wealth that is causing rising consumption) fueling oil production? And if India is truly seeking energy independence, is a Nano in every garage the way to go about it?

Even though I would like countries to scale back their energy consumption, it’s hardly fair to insist that nations forego the conveniences of cheap energy that Americans and Europeans have enjoyed for more than a century. In general, the benefits of a sturdy middle class outweigh the disadvantages of consumption. So I hope Tata’s plan for a Nano plant gets the green light again.

And then, maybe next, Tata can tackle global warming. After all, is there nothing this company can’t do?