Mayor Samip Joshi said it was "unacceptable" and asked for an apology from the group that organised the parade in Edison, New Jersey.
Joshi spoke during a meeting which consisted of concerned residents and activists and said the inclusion of the bulldozer at the parade was a "symbol of division."
He asked for the Indian Business Association, the organisers of the rally to apologise.
"I understand a bulldozer is a symbol of division and is absolutely unacceptable. There is no place for that in Edison Township. I would like to see an apology from the Indian Business Association."Samip Joshi, Mayor of Edison, New Jersey, US
Over the past several years bulldozers have become a symbol of hate in India due to a trend wherein the authorities are using excavators in order to demolish predominantly Muslim-occupied homes under the premise that the structures are "illegal." Many homes of Muslim activists have been demolished during the past few years in this manner.
The United Nations along with many human rights groups have called for an end to this practice referring to it as a "collective punishment".
Joshi, who attended the rally on 14 August, said even though he saw the bulldozer during the parade he was unaware of what it symbolised.
"I only found out the next day what it meant."Samip Joshi, Mayor of Edison, New Jersey, US
Activists and residents were calling for a suspension of the annual rally that has a 19 year long tradition. However, Joshi wouldn't commit to suspending future rallies. Instead he promised that the town of Edison would be implementing a stricter screening process for future events.
Other activists called for the creation of a task force to identify and mitigate bias that might provoke hate fuelled incidents.
(With inputs from The Middle East Eye)