The vehicle scrapping policy also called the “Voluntary Vehicle-Fleet Modernisation Programme”, was unveiled in Parliament in March 2021 by Road Transport & Highways Minister Nitin Gadkari. The aim of the government is to create a circular economy and bring value to all the stakeholders with an emphasis on the environment.

As per the policy, all the automobiles which have crossed a certain age should be off the roads in order to control pollution and safety, which is ensured by new vehicles. 

Commercial vehicles over 15 years old and personal vehicles over 20 years old are marked for scrapping. They will be scrapped if they fail an automated fitness test. They will be deregistered and the owner can choose to scrap them but not use them on the road.

Circular Economy

This kind of economy depends on reuse, sharing, repair, refurbishment, remanufacturing and recycling of resources to minimize usage, waste generation, pollution and carbon emissions.

When scrapping is done, metals and many other parts can be refurbished to make some other product. Recycled steel, plastic parts, everything has value after being scrapped.

In the circular economy, products, materials, equipment and infrastructure are kept in use for a longer period, thus improving productivity.

Number of Vehicles

India has 51 lakh motor vehicles that are more than 20 years old and 34 lakh over 15 years old. 17 lakh medium and heavy commercial vehicles are over 15 years old.

India is currently not ready with the infrastructure to test for fitness or scrap vehicles in large quantities. Hence, everything will happen in a phased manner over a timeline. 

There are guidelines on what kind of Automated Fitness Centre will be set up and who can set up. Similarly, for scrapping yards. 

An ecosystem is being created where everything can happen seamlessly. 

Incentives

The government is giving the owners some incentives to motivate them towards scrapping their old vehicles. Those who have the scrapping certificate will get a tax rebate, sops and discount on new cars.

Also, the certificate will be tradable which means that it can be used by anyone and not just the owner.

In case, a vehicle passes the fitness test, then the owner can continue to use their vehicle but the charges for registration will be high. It will be hiked from 8 to 20 times depending on the vehicle.

This scrappage policy will help in boosting the economy as demand is being generated. There are many environmental benefits as well. The new cars that are being manufactured have better emission standards and better fuel efficiency. Hence, this new policy is the need of the hour considering rising pollution levels and global warming.

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