Prime Minister Narendra Modi announced the new vehicle scrappage policy at the Gujarat Investors Summit, which aims to recycle old and unfit vehicles, is estimated to attract investments of roughly Rs 10,000 crore and boost the circular economy
Prime Minister Narendra Modi announced the vehicle scrappage policy on August 13 during his virtual address at the Investor Summit in Gujarat. Announcing the policy, Prime Minister said that the introduction of the Vehicle Scrappage Policy marks an important step forward in India’s growth, the establishment of automobile scrapping infrastructure throws up a new world of possibilities. Vehicle scrapping will aid in the environmentally friendly phasing out of obsolete and polluting vehicles. “Our goal is to establish a viable circular economy that adds value to all stakeholders while remaining environmentally responsible,” the Prime Minister stated in a series of tweets prior to the event.
The goal is to phase out automobiles and commercial vehicles that are more than 20 or 15 years old. This is being done in an effort to minimise urban pollution and boost vehicle sales, which have been slow during India’s post-COVID recovery period. This means that any private car over the age of 20 will have to pass a fitness test. According to the Finance Minister, a fitness test will be undertaken at automated fitness centres to assess whether the vehicle is qualified to run on highways or is destined for the trash heap.
After the allowed 20-year term, a vehicle will be required to undertake a fitness test, according to the new policy requirements. While the car might pass a fitness test and receive a certificate, media sources earlier this year suggested that each fitness test would cost around Rs 40,000. This is in addition to the road tax and a possible “Green Tax” that you must pay when renewing your private vehicle’s registration after 15 years.
Each fitness certificate is valid for five years, after which the vehicle’s owner must undergo a new fitness test, which costs the same. The cost of keeping an automobile in road-worthy condition would prevent the owner from renewing the certificate on a regular basis.
Nitin Gadkari, the Union Minister for Road Transport and Highways, who was also present at the event where Modi unveiled the new policy, said the measure is expected to result in a 40 per cent reduction in raw material costs. “The automobile industry is the highest revenue-producing sector in the country, contributing to the employment of a huge number of people; Government is looking forward to providing all needed support to create this industry,” said Nitin Gadkari, Minister of Road Transport and Highways.
Yes. The government has suggested a Green Tax, which would oblige you to pay 10 to 25% of your road tax each time your fitness certificate is renewed. This implies that, in addition to the test charge, you’ll have to pay a significant sum, which varies by city and is based on pollution levels. In the Delhi-NCR zone, for example, if the Green Tax is adopted, the customer will be required to pay half of the road tax while renewing their registration.
It is prohibited to drive an automobile that has not passed a fitness test since it is considered unregistered, according to the legislation. While going through the necessary re-registration process, one cannot avoid taking a fitness test, and if the vehicle fails the test, it is simply not registered, making it unlawful to operate on the road. The programme, which will take effect on April 1, 2022, will also provide a monetary incentive to owners who send their vehicles to the scrap yard, but they won’t have much of a choice if the vehicle fails the fitness test three times.
More information, such as how to build up scrappage docks/yards, is awaited. Over 51 lakh cars, both private and commercial, are over 20 years old under the proposed legislation. Its removal from the highways would not only encourage their owners to purchase new vehicles and maybe adopt innovative technology, such as EVs, but it will also help reduce traffic pollution by 25%.
