You may have heard of other standards like Euro. in Europe and Tier 1, Tier 2, used in USA.
More the number assigned, less air polluting the engine or less pollutants, the engine is releasing. In India, the BS 4 Engines are applied for the NCR and some other cities while, BS 3 Engines are applied nation wide. Although, in coming years the BS4 engines will be applied nationwide i.e. the manufacturing of BS3 engines will stop.
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