The current car is almost certainly not capable of meeting the tough safety standards in Europe - where it would be sharing the roads with much larger and speedier cars than it does in India - and emissions questions also linger. The second-generation Nano would be designed to meet the requirements for sale in Europe - and likely, therefore, also the U.S. or other countries with similar standards.
Whether the Nano will be able to meet the safety and emissions standards while staying near its $2,500 price mark is another question altogether, however. Already very efficient at just 5L/100km (47mpg US/56.5mpg Imperial), the goal is to improve the second-generation Nano's fuel consumption even further. As the horsepower wars subside and the green wars get spooled up, we may see the Nano as the leader of the new brigade of light, efficient, and incredibly inexpensive transportation. On the other hand, engineering costs and legislative requirements could end up adding bulk and expense to the Nano until it's essentially indistinguishable from any of the dozens of small cars already on the European market.