Prime Minister Narendra Modi has finally unveiled the much-awaited vehicle scrappage policy on August 13, during his virtual address at the Investor Summit in Gujarat.
The new vehicle scrappage policy called the “Voluntary Vehicle-Fleet Modernisation Programme”, seeks to usher in a new age of what it means to own and use an automobile in India. PMModi said at the time of the launch that as the incumbent method of scrapping of materials was not productive, the new policy is expected to generate investments of around Rs 10,000 crore.
The Union Road and Transport Minister Nitin Gadkari said that the policy is likely to lead to a cut in raw material costs by around 40 per cent.
The policy aims to phase out the older vehicles on roads in a bid to reduce urban pollution levels and promote automotive sales.
As per the policy, the car owners will have to undergo a mandatory Fitness test of cars which will be conducted at automated fitness centres, with the purpose of determining whether the vehicle in question is qualified to run on roads, or headed for the scrap heap.
If the car passes the test then it would acquire a fitness certificate; each fitness test would cost approximately Rs 40,000 and the certificate would be applicable for five years, after which the owner of the vehicle will be required to get another fitness test, costing the same. If the vehicle fails the test then it would be mandatory for the vehicle to go to the scrap heap
The policy, which will be in effect from April 1, 2022, would also offer a monetary incentive to the owners sending their vehicles to the scrap heap.
Under the new policy, more details pertaining to setting up scrappage docks/yards etc, are still awaited. In India, there are over 51 lakh vehicles, both private and commercial are over 20 years old. If they were to be removed from roads, this would encourage their owners to buy new vehicles, and possibly adopt newer technologies, like EVs, it will also help bring down vehicular pollution by an estimated 25 per cent.