2,1 is a Renault turbo diesel engine, 66kW (90HP). Not much powerfull, quite reliable, except some problems with cyl. head gasket. Parts (except of some specs) are widely available in Europe (Renault junkyards). Was made until 1993 i think (not sure). Manual gearbox AX5 or Peugeot BA10-5, rare with 3-stage auto tranny 30-RH. Had 4.11 as a standard gear ratio. Not so much power, when lifted and tires over 30 = pain.
As a stock is quite acceptable for normal quiet comford ride, but only if you do not have ANY racing ambitions

The only positve is MPG, you can get as much as 40MPG !!!
The other diesel engine in XJ is a 2,5 litre turbodiesel engine made by an italian company VM Motori (part of Detroit diesel). This engine is said to be very unreliable due to overheating problems and cylinder head starvage. That's CRAP !!!
It is as reliable as the other turbocharged diesels. Can be found in many cars (AlfaRomeo, LandRover, Toyota, Opel, London Taxi....) and the only one with thermal problems is a Jeep. But that is not the fault of the engine, it is a problem of the Jeep engineers :-(
This engine has a bit strange construction with separate cylinder head for each cylinder. It is because of the original purpose of the engine - generator and marine use. Was produced as a 3cylinder 1,8ltr, 4cylinder 2,5ltr and 5 cylinder 3,1 ltr version.
The head starvage is caused by lack of free space in the engine compartment and poorly designed cooling. And the problem comes out not while the engine running, but a while after stop. The massive cast-iron engine block accumulates lot of heat and a while after turning the engine off the heat from the block starts to dissipate and the small alluminium cyl. heads are not able to accept so much heat from the block, so the water in the heads starts boiling = cracked head.
The very simple solution is to install an aux oil cooler and a small electric water pump, triggered by a thermal switch, which runs for a while after the engine off and keeps the cooling water circulate.
it is also recommendable to install hood vents and fully electric fans = no viscous coupling.
The 2,5 ltr version (found in XJ, ZJ, GS...(aka 4headed 4banger

) ) has a stock 116PS and 260Nm torque. Can be modified up to 140PS and 300 Nm.