Mint Explainer: Why India isn't ready to ditch diesel just yet

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GST on generators and vehicles with diesel-powered engines. His words were meant to provoke, clearly, as is the minister's usual manner. The prospect of a tax on the fuel that powers all large trucks in India caused stock prices to plummet.

Here's what transpired, and why India is unlikely to ditch diesel entirely any time soon. "Along with an increase in automobile manufacturing, import of fossil fuels is also going up and will keep going up. Pollution will adversely affect the citizens of the country.

So, please leave diesel and petrol behind and contribute to a pollution free-economy; otherwise, I will urge the finance minister to impose a 10% ‘pollution tax’ on every engine that runs on diesel," Gadkari said, adding, "I am hopeful you will act fast and I will not need to take such a decision". Soon after, the stock prices of Tata Motors and Ashok Leyland, the country's largest and second-largest commercial vehicle makers respectively, and Mahindra & Mahindra, which accounts for almost half of all diesel passenger vehicles sold in India, started to tank. This prompted Gadkari's office to clarify that no such proposal was under active consideration.

While that may be the case, the message to the industry is clear: the government doesn't want engines powered by diesel around for too much longer. But for India, giving up the fuel will be challenging. To be sure, diesel-run engines have been steadily losing favour with automakers owing to tighter regulations and emissions norms, which make diesel engines more expensive to produce and thus harder to sell.