India's auto giant, Tata Motors, today (Thursday) unveiled Nano, what it has been billed as the world's cheapest car at just 100,000 rupees ($2,500).

Chairman Ratan Tata drove the long-awaited car on to the stage at the Auto Expo in New Delhi and told the audience the price tag for Nano remained the same (Rs100,000) as promised five years ago, even though commodity prices had gone up. 'That's because a promise is a promise,' Tata said.

He dubbed Nano a low-cost compact and no-frills family vehicle which was set to revolutionise the market of 1.1 billion people.

The car, a hatchback with a 624cc engine, is priced at about half that of the current cheapest car in the market, and is a sharp contrast to the luxury Jaguar and Land Rover brands that Tata is negotiating to buy from Ford Motor Company.

The mini car is targeted at Indians hoping to trade up to four wheels from a motorcycle.

The Tata 'Nano' -- which looks almost exactly like a Smart -- has no air conditioning, no electric windows and no power steering for the basic model, although two deluxe models will be on offer.

Tata said he wanted to make 'a safe, affordable and all weather transport - a people's car, designed to meet all safety standards and emissions laws and accessible to all' and 'a car that most people said could not be manufactured at that price.'