Honda is reportedly developing a small-capacity diesel engine for the Indian market. While the development is currently only in the nascent stages, the car maker is targeting developing the engine in order to establish a firmer stronghold in India. While Honda hasn't officially announced the development of this engine yet, Tomohiko Kawanabe, the Japanese manufacturer's Chief Operating Officer of Reseach & Development, has made statements that indicate the same.
Kawanabe declared that a small diesel engine was essential in order for Honda to become even stronger in developing markers like India. He went on to say that a car maker could only hope to be competitive in markets like India if they had a diesel engine in their line-up.
If Honda does come out with the diesel engine, they will be looking at powering cars like the City, Jazz and even their New Small Concept.