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Scrap Value: 5% Discount On New Vehicles

Gardkari moots registration waiver, tax reliefs

Older vehicles pollute the environment 10 to 12 times more than fit vehicles and pose a risk to road safety, says Nitin Gadkari.

NEW DELHI, Mar 18 (The CONNECT) - You may get a discount up to 5% on new vehicle as scrap value for your old car.

As part of the vehicle scrap policy, the Centre has proposed to the States to give a road tax rebate up to 25% for personal vehicles and up to 15% for commercial vehicles and waiver of registration fee.

Efforts are also being made to set up Integrated Scrapping Facilities across India. Some of the identified places include Alang in Gujarat, where it is being planned to develop a highly specialized centre for scrapping, among many other potential centres, where different scrapping technologies can be synergized together.

Making a Suo Motu statement in the Lok Sabha Minister for Road Transport and Highways, Nitin Gadkari today said “Older vehicles pollute the environment 10 to 12 times more than fit vehicles and pose a risk to road safety”. “In the interest of a clean environment and rider and pedestrian safety, the Ministry of Road Transport and Highways is introducing the Voluntary Vehicle-Fleet Modernization Program (VVMP) or Vehicle Scrapping Policy which is aimed at creating an Eco-System for phasing out of Unfit and Polluting Vehicles,” Gadkari said.

Hailing the announcement, Vinkesh Gulati, President -  Federation of Automobile Dealers Associations (FADA), said the guidelines and advice are in the right direction and now, the State Governments and OEMs have to do their part to make it a success.

Indian automobile industry has already upgraded to one of the most advanced emission standards. While new vehicles will be least polluting, vehicles which are old creates enormous pollution with least safety standards will now be eligible for scrappage thus making roads safer and air cleaner, Gulati said.

Gadakari explained that the objectives of the policy are to reduce population of old and defective vehicles, achieve reduction in vehicular air pollutants to fulfil India’s climate commitments, improve road and vehicular safety, achieve better fuel efficiency, formalize the currently informal vehicle scrapping industry and boost availability of low-cost raw materials for automotive, steel and electronics industry.

The ecosystem is expected to attract additional investments of around Rs. 10,000 Crore and 35,000 job opportunities. The Ministry shall, in the next few weeks, publish draft notifications, which shall be in the public domain for a period of 30 days to solicit comments and views of all involved stakeholders.

The Ministry of Road Transport and Highways will promote setting up of Registered Vehicle Scrapping Facility (RVSF) across India and will encourage public and private participation for opening up of such centres.

Tentative timelines for application of Proposed Scrapping Policy are:

  • Rules for Fitness Tests and Scrapping Centres: 01st October 2021
  • Scrapping of Government and PSU vehicles above 15 years of age: 01st April 2022
  • Mandatory Fitness Testing for Heavy Comm. Vehicles: 01st April 2023
  • Mandatory Fitness-Testing (Phased manner for other categories): 01st June 2024

The criteria for a vehicle to be scrapped is primarily based on the fitness of vehicles through Automated Fitness Centres in case of commercial vehicles and Non-Renewal of Registration in case of private vehicles. The criteria is adapted from international best practices after a comparative study of standards from various countries like Germany, UK, USA and Japan. A Vehicle failing the fitness test or failing to get a renewal of its registration certificate may be declared as End of Life Vehicle. Criteria to determine vehicle fitness will be primarily emission tests, braking, safety equipment, among many other tests which are as per the Central Motor Vehicle Rules, 1989.

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