Renault will soon launch a Tata Nano rival of its own.

Despite the somewhat limited success of the Tata Nano, Renault is reportedly continuing development of its own sub-compact to rival the world's cheapest city car. The French car maker is also said to be readying a budget car that would be positioned slightly above its Nano rival.

According to French Web site Latribune.fr, Renault, in conjunction with corporate partner Nissan, is currently working on two budget vehicles for emerging markets like India. The first car will target vehicles like the Nano and carry a price tag of about $3,850 while the second will sit slightly up-scale, commanding about $6,400.

Both vehicles are expected to be produced in Chennai, India. Renault could market the vehicles in other emerging market, but the French automaker has no plans to sell either car in Europe.

"Renault is extremely good in the cheap, entry-level car segment and their Dacia brand cars are extremely profitable," Gaetan Toulemonde, an analyst for Deutsche Bank, told Automotive News Europe. "I would definitely give them the benefit of the doubt that their India car launch will be successful."

Expanding outside of Europe is a key part of Renault's financial strategy going forward. Renault is shifting focus to emerging markets to offset losses associated with Europe's slumping car. The automaker is on pace to sell more than half of its vehicles outside of Europe this year - a full four years ahead of its target date for that goal.