Tata Motors, the lead bidder for Ford’s luxury Jaguar and Land Rover brands, has unveiled the world’s cheapest car called in a bid to get poorer families into cars.

The Nano, dubbed by Tata as ‘the people’s car’ will be priced at £1,300. The car will be sold in India first but will head to South America, South-East Asia and Africa.

It’s possible the Nano could reach Europe but the £1,300 starting price would be likely to rise in order to meet European safety standards.

Ratan Tata, chairman of the Tata Group, said: “I observed families riding on two-wheelers – the father driving the scooter, his young kid standing in front of him, his wife seated behind him holding a little baby.

“It led me to wonder whether one could conceive of a safe, affordable, all-weather form of transport for such a family.”

The Nano is built to meet Indian safety standards and is powered by a rear-wheel drive, all-aluminium, two-cylinder, 623cc, 31bhp petrol engine capable of 65mph.

A deluxe model is planned which will feature air-conditioning and more luxurious interiors. These will cost more and Tata hints that profit will only come from the more expensive variants.

The luxury version of the Tata Nano The standard Nano