A draft circular for the new regulation has already been issued by the Bureau of Indian Standards, and the rule is expected to take effect in the next 40 to 60 days.

"It will mean a huge dent for the Indian automobile industry as vehicle manufacturers will now have to start sourcing local tyres for even their high-end vehicles – some of which sell only in limited numbers and do not make economic sense to have local sourcing deals. Manufacturers can’t just import cars without tyres and start retrofitting ISI-marked tyres in India," Society of Indian Automobile Manufacturers (SIAM) director general Dilip Chenoy told the Times of India.

However, the news is likely to been seen in a more positive light by leading Indian manufacturers like Apollo, MRF and JK Tyres. Apollo only recently announced plans for the construction of a new radial tyre production plant. The law has reportedly been introduced in response to the large number of Chinese tyres flooding the Indian market.

The regulation, local newspapers report, also runs the risk of seriously denting the Indian auto market. "If manufacturers of high-end vehicles decide to ship their cars into India without the tyres and then fit tyres locally, these vehicles would no longer classify as an imported car. As a result, they would attract a much lesser duty making them cheaper by nearly half their current prices. This would also prove detrimental for the domestic auto industry and would be against the spirit of government resolve to make India the manufacturing hub for cars," an industry insider told the Times of India.

The luxury car market has reportedly been growing at more than 70%, according to reports.