Well, a N/A 1.4 is easily capable of 85 BHP these days and typically you can acheive double the BHP with Turbo's and fueling mods so yes 170 BHP is acceptable.
Even my Honda 1.6 VTEC was 158 BHP
If you think about it a N/A 2.0 petrol is normally around 130BHP but a decent 2.0 Petrol Turbo will put out 260BHP (double).
Where this 1.4 VW unit will score highly is in the cruising mode where you will get big MPG's and low emissions (lower tax). But give it some right foot and it will turn into a racer.