Diesel burns more slowly than gas. It's why diesels are limited in RPM as anything faster and it's hard to get complete fuel burn. HP is calculated, torque is what's measured on a dyno. So, saying it only makes 188 HP isn't the whole story as HP is calculated directly against RPM. The big torque values made by Diesel engines is due to the really high compression ratios they run (compression ignition). If you ran a gas engine at those compression ratios, you'd see similar torque values (hypothetically). Diesels will always make more torque than HP for those reasons, but if you hypothetically ran out a diesel torque curve to 6K RPM, you'd see some nice HP numbers. Contrary, comparing an naturally aspirated gas engine is kind of the opposite where torque values are relatively low, but HP is high. Take a Honda S2000 motor at 162 ft lbs and 237 HP vs a Sprinter at 325 ft lbs and 188 HP. Sprinter is RPM limited where the S2000 redlines at over 8K.

You can't compare HP from a gas car to HP in a diesel since torque values are so different. The equation for HP is (Torque x RPM)/5252. That 5k constant is where HP and torque cross on a dyno chart for a gas car.

If you compare HP between the MB 2.0 diesel and the MB 3.0 (161 vs 188), it doesn't seem like a lot. But, the torque value difference is 265 vs 325, which is a much bigger difference. The S2000 is 2.2 liters and makes 160 ft lbs vs the MB's 2.0 making 265 ft lbs. That's a huge difference between those two motors. Apples to oranges.