The 2021-22 Union Budget had proposed the initiation of a vehicle scrapping policy that would see old and polluting vehicles gradually phased out. Finance Minister Nirmala Sitharaman had said that under this voluntary policy, personal vehicles would undergo fitness test after 20 years while commercial vehicles would require it after completion of 15 years. Now, Road Transport, Highways and MSMEs Minister Nitin Gadkari has shed additional light on the topic.
Making a statement regarding vehicle scrapping policy in the Lok Sabha, he said the policy will also lead to an increase in the country's automobile industry turnover to Rs 10 lakh crore from the current Rs 4.5 lakh crore.
What makes a vehicle eligible for scrapping?
While the policy is yet to be implemented, Gadkari said that the criteria for scrapping would be based on its fitness. Primarily emission tests, testing of braking and safety equipment are more would be carried out, and any vehicle failing the fitness test or failing to get a renewal of its registration certificate may be declared as an 'End of Life Vehicle'.
As per the proposal, commercial vehicles be de-registered after 15 years in case of failure to get the fitness certificate, while private vehicles be de-registered after 20 years. In both cases, there would be increased re-registration fees for private vehicles 15 year onwards from the date of initial registration.
Gadkari also proposed that all vehicles of the Central Government, State Government, Municipal Corporation, Panchayats, State Transport Undertakings, Public Sector Undertakings and autonomous bodies with the Union and State Governments be de-registered and scrapped after 15 years from the date of registration.
What are the incentives offered?
Gadkari has also issued an advisory to automakers, advising them to provide an incentive of a five per cent rebate for those buying a new vehicle after producing a scrapping certificate.
When will this process be implemented?
Tentative timeline for the application of the Proposed Scrapping Policy:
1. Rules for Fitness Tests and Scrapping Centres - 1st October 2021
2. Scrapping of Government and PSU vehicles above 15years of age - 1st April 2022
3. Mandatory Fitness Testing for Heavy Comm. Vehicles - 1st April 2023
4. Mandatory Fitness-Testing (Phased manner for othercategories) - 1st June 2024