Seeking to revive its tarnished image and increase market share in India, Italian carmaker Fiat is planning to launch new SUVs and sports cars with a focus on the niche and specialist markets of the country.

Having a market share of just 0.3 percent in India with February sales totalling to 203 units, Fiat has performed poorly in the Indian auto market. The company is one of the first western carmakers to enter into the world's seventh largest car market.

Fiat currently targets to enlarge its market share to 1 percent by the end of 2013 and to 5 percent in the long term.

"We all believe that we have scratched the bottom of the barrel," Enrico Atanasio, managing director of Fiat India told Reuters. "(Our performance) is not what the brand deserves."

In order to reach this goal, Fiat is taking up several measures like expanding its independent dealerships in and rolling out more vehicles in the niche markets.

The company will set up a fully owned 57 dealer network on 1 April, cancelling a distribution agreement with Tata Motors. By April next year, Fiat is estimated to have a total of 112 independent dealers across the country.

In addition to augmenting its dealership base, the company plans to enhance its Indian product portfolio with key additions. It intends to focus on fast-growing area like SUVs and sporty cars, rather than entering into the cheap, small car segment dominated by Hyundai and Maruti Suzuki.

Fiat will launch its Chrysler Jeep SUV in the country in 2013 and build a small version of the vehicle by 2015. In the luxury segment, the company will test the market appetite for Abarth, the sports version of its 500 and Punto models.

India's car market is expected to grow to about 6.9 million vehicles in 2017 from the current 2.6 million, according to LMC Automotive.