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India's Tata Motors has launched the world's cheapest car, the Nano, hoping to revolutionise travel for millions and buck a slump in car sales caused by the global economic crisis.
Others say the car will only add to road congestion and pollution in India.
Company boss Ratan Tata said the no-frills car, slated to cost the equivalent of about R20 000 for the basic modelin India, would get India's middle-class urban population off motorcycles and into safer, affordable four-wheelers.
"I think we are at the gates of offering a new form of transport to the people of India and later, I hope, other markets elsewhere in the world," he said.
"The present economic situation makes it somewhat more attractive to the buying public."
Hundreds of people, including journalists and company officials, gathered for the official unveiling on Monday.
Orders for the tiny car, just more than 3m long, will be taken from April 9 and end on April 23, said Ravi Kant, Tata's Motors managing director. A ballot would then select 100 000 people to be the first to get the keys to the vehicle.
Deliveries willstart in July.
Even affluent Indians are eyeing out the Nano, which has a two-cylinder engine, four-speed manual transmission and a top speed of 105km/. It has no aircon, power windows or power steering but deluxe versions will be available.
"This is a value-for-money car," said Hasmukh Kakadia, a Mumbai investment analyst.
Dealers say they have been flooded with queries about the car, whose debut was delayed after violent protests over the acquisition of farmland to build the Nano plant, forcing Tata Motors to shift from West Bengal state to Gujarat.
However the new plant in western India would not be ready until late 2009 or early 2010, Tata said. That meant production must come from existing factories, reducing output and potentially increasing delivery times.
Kant admitted that some customers might have to wait more than a year for their Nano.
Tata is hoping the Nano will be a hit overseas in the long term. Earlier this month the firm unveiled a European Nano sporting crash bags and leather trim that will hit the market by 2011.
A US version is on the drawing board but requires redesigning to meet American safety standards.
Environmentalists, however, fear the Nano will accelerate congestion on India's already crowded roads and add to choking pollution.
"Every car that goes on the road is going to use road space. We're only adding to congestion," said Rajendra Pachauri, head of UN's climate panel.
Tata countered by saying that the Nano was the least-polluting car in India, emitting 101g of CO2/km. - Sapa-AFP