Hamish McRae: Don't be arrogant – this is an idea whose time has come

India's "one-lakh car" is an idea whose time has come. It is great step forward for the burgeoning Indian middle class, bringing safe, affordable personal transport to families. It is also a triumph for Indian engineering, demonstrating that it is able to achieve something that the established manufacturers of the developed world have conspicuously failed do.

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.

The new car fills the gap between a standard mini-car and the motor-scooter or motorbike, a gap only partly filled by a tuk-tuk, those little three-wheelers that serve as taxis not just in India but in much of south-east Asia.

India's economic take-off – growth was close to 9 per cent last year – is lifting millions of people of out poverty into a new middle class but it is a middle class that is by Western standards still poor. For these people, the only way of having mobility is either the motor-scooter option, terrifying and dangerous, or scratching together enough money to buy a patched-up second-hand car. Think the same sort of transition as in 1930s Britain, when the Austin 7 started to supplant the motorcycle and sidecar, or in the impoverished post-war years when the Fiat 500 and 2CV Citroen brought motoring to the masses on the Continent. The "one-lakh car", at 100,000 rupees or about £1,300, is aimed at a similar market to that of the Austin 7 but it is much better engineered.

European and Japanese manufacturers build small cars but they do not try to build really cheap ones because they cannot make money out of them. Our smallest cars, such as the Smart car, are cute little jewels designed to make owners feel good rather than meeting basic motoring needs. China has followed the West, producing relatively large cars, often rip-off copies of Western designs, so it has a less fuel-efficient car fleet than France and probably the UK.

That leads to the environmental issue. It is easy for people in the comfortable West to voice concern at the prospect of a billion Indian people owning cars, for we are aware of the social and other costs of mass motoring. But that is also arrogant and economically illiterate.

It is arrogant to hold that hard-working Indians should not be bright enough to chose how they should spend their salaries. It is illiterate for a host of reasons. One is that it won't be a billion people because car use in India will remain far below developed-country levels for generations. Another is that if India is to retain its middle class, essential for transforming the lives of the whole society, it has to be able to offer it a middle-class lifestyle.

Another is that a more modern car fleet will be, safer, more efficient and less polluting. Still another is that when, in a decade or so, India becomes a larger economy than the UK, the energy consumption of its vehicle fleet will still in all probability be lower than ours. That is not true of China.

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