To shed a bit more light on the subject of torque vs hp consider that an engine's torque and its HP are both derived from fuel. When fuel burns and produces heat it wants to expand putting pressure on the top of the piston. The larger the piston the more downward force will be created on the connecting rod. The combustion pressure of a diesel engine may be say 600 psi; if the area of the piston head is 12 square inches a force of 7200 pounds would be pushing downward on the piston top. A smaller diameter piston with that same 600 psi pressure would put less pressure on the conecting rod. The longer the the crank throw or stroke the more leverage this force can use to twist on the crankshaft. From this explanation it should be easy to see how both bore and stroke or displacement contribute to an engine's torque rating. Additionally by thinking about this one can see that torque is a result of fuel burned per power stroke. As a rule, the more fuel the engine can burn per revolution the greater will be its maximum torque. The maximum torque will often be achieved at the rpm where the engine is most efficient. This is why gearing up and slowing the engine rpm down will often have a positive effect on fuel economy.
Power on the other hand has an additional component, that of time. So power is torque x rpm or work/time or fuel burned per unit time. The more fuel an engine can make use of per time the more power it will be capable of producing. So when considering the power of an engine it is basically the fuel burned per revolution (torque) times the revolutions per min. A large displacement (or turbocharged) engine will not need to turn as many rpm as a smaller displacement (or non turbo'ed) engine to make use of the same amount of fuel per time and therefore produce similar power.
