Vehicle Scrappage Policy

Context:

• Vehicle Scrappage Policy launched in India.
• It was first presented at the Union Budget 2021.
• It is is voluntary, but it would require mandatory fitness tests for vehicles after certain duration.

What exactly is vehicle scrappage policy?

• It comes into effect when a vehicle’s registration is complete.
• In general, a passenger vehicle has a life of 15 years and a commercial vehicle has a life of 10 years, after which they become obsolete and also starts polluting the environment at a greater intensity than they would have been doing earlier.
• In western countries, these old vehicles are sent to scrapyards where they are dismantled and the steel used for making the body is crushed and recycled again.
• In India though, there was no such policy. Most of the vehicles either are on run currently polluting the environment or are lying at road sides.

What does the policy aim to achieve?

• To reduce air pollution
• Generate space for new vehicles
• boost the sales of new vehicles

Will all vehicles over and above time limit will be scrapped?

• No, not all vehicles will be scrapped as this is a voluntary scheme and not a mandatory one.
• All vehicles over and above the time limit will have to undergo mandatory fitness test.
• If a vehicles fails fitness test, they will not get renewal certificate and won’t be able to run on road.
• However, if they pass fitness test, they will have to undergo fitness test after every 5 years again to show their road worthiness.

What benefit will one get from scrapping my vehicle?

• A scrap value of the ex-showroom price of vehicle ranging from 4-6% will be given to the owner if they choose to scrap the vehicle
• A rebate of upto 25% will be given in Road Tax
• Vehicle manufacturers will be advised to give 5% discount on new vehicles against a scrapping certificate
• No registration fees for vehicles.

What is a fitness test?

2. Much like Pollution Under Control (PUC) certificate test, determines the road worthiness of a vehicle and checks if the vehicle is harming the environment.
3. Various other tests like brake test, engine performance among others will be in place to check the quality of the vehicles.
4. A fitness test, will be conducted at automated fitness centres.
5. These centres will be established under PPP model and it is estimated that each fitness test will set you back by at least Rs 30,000-40,000 and a green cess will also be levied while renewing the vehicle registration.

From when is the policy applicable?

• From 2023 onwards, heavy commercial vehicles need to be scrapped if they do not conform to the fitness level prescribed under the rules.
• For personal vehicles, plan to implement this scheme is from June 2024 onwards.

https://www.indiatoday.in/auto/story/vehicles-scrappage-policy-launched-all-rules-and-benefits-explained-in-5-points-1840491-2021-08-13