India, Sept. 28 -- India is no country for small cars? A dealers lobby doesn't think so.

"This 'SUV-isation' of the industry is happening throughout the world. It is not because India has bad roads... It is going to be there for quite some time to come," CS Vigneshwar, president of the Federation of Automobile Dealers Associations told Press Trust of India.

But while SUVs give a purpose of comfort, style and safety, "hatches will have their own space because some people still want the hatches", he said.

The recent GST rate cut on small cars and a flat 40% on SUVs, after more than two years of outsized demand for oversized cars, has sparked a debate on how India buys cars.

On 4 September, the GST Council reduced rates on hundreds of it...