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BENGALURU - Retail sales of vehicles in India could take a hit in the final quarter of the fiscal year, an automobile dealers' body said on Thursday while reporting a more than 5% year-on-year fall in sales for December at 1.62 million units.

India has mandated automakers to comply with stricter fuel efficiency norms from April 2023, aimed at reducing carbon emissions. This, the Federation of Automobile Dealers Associations (FADA) said, would trigger further price hikes and result in weaker sales for the quarter ending March 31.

Auto sales numbers are keenly watched, as they are one of the key indicators to assess private consumption and carry more than 50% weightage in calculating the country's economic growth.

FADA data on Thursday showed that sales of two-wheelers, which account for 60%-70% of total vehicle sales, dropped 11.2% to 11,33,138 units.