The Chinese and Indian car markets experienced contrasting fortunes in August, with the former posting robust sales while the latter was hit by its first drop for nearly a year, write James Crabtree and Patti Waldmeir.

Indian car sales fell 19 per cent to 118,142 compared with the same month in 2011 as slowing growth, high interest rates and a factory shutdown hit trading conditions in Asia’s third-largest economy.

Sales of two-wheeled vehicles fell 8.5 per cent, the first fall in three years, according to figures released by the Society of Indian Auto Manufacturers, an industry body. India’s car industry has struggled recently following years of strong growth, forcing manufacturers to shut factories and trim output targets in the face of slowing customer demand.