Vehicle Scrappage Policy Launched

Vehicle Scrappage Policy Launched

Subject – Infrastructure

Context – Prime Minister while addressing the Investor Summit in Gujarat via video conferencing launched the Vehicle Scrapping Policy/National Automobile Scrappage Policy.

Concept –

The policy is estimated to cover 51 lakh Light Motor Vehicles (LMVs) that are above 20 years of age and another 34 lakh LMVs above 15 years of age.

What is the scrapping policy?

The vehicle scrapping policy is aimed at creating an ecosystem for phasing out unfit and polluting vehicles in an environment friendly and safe manner.
The policy intends to create scrapping infrastructure in the form of automated testing stations and registered vehicle scrapping facilities across the country.

Guidelines
Union minister Nitin Gadkari said that commercial vehicles over 15 years old and personal vehicles over 20 years old will be marked for scrapping if they fail to pass the test.

• The new regime, aimed at cleaner emissions, fuel efficiency and better safety, will start mandatory testing of heavy commercial vehicles from April 2023 and for other categories, in a phased manner, from June 2024.
• For vehicles owned by governments and allied entities like PSUs, the policy will kick in earlier, from April 2022.

For now, vintage cars will be exempted from this policy, separate guidelines will be later formulated to regulate them. 

Incentives- Vehicle scrapping policy provides incentives for purchase of new vehicle against scrapping certificates of old vehicle with road tax rebate up to 25 per cent; waiver of registration fee; and discount by vehicle manufacturers.

Provisions:

• Fitness Test – Old vehicles will have to pass a fitness test before re-registration and as per the policy government commercial vehicles more than 15 years old and private vehicles which are over 20 years old will be scrapped.
  • Old vehicles will be tested at authorized Automated Fitness Center and will not be scrapped merely on the basis of age.
  • Emission test, braking system, safety components will be tested and the vehicles which fail in the fitness test will be scrapped.
  • If the old vehicle passes the test, the owner can continue to use it, but the charges for reregistration will be much steeper.
  • The Union Road and Transport Ministry has also issued rules for registration procedure for scrapping facilities, their powers, and scrapping procedure to be followed.
• Road Tax Rebate – The state governments may be advised to offer a road-tax rebate of up to 25% for personal vehicles and up to 15% for commercial vehicles to provide incentive to owners of old vehicles to scrap old and unfit vehicles.
• Vehicle Discount – Vehicle manufacturers will also give a discount of 5% to people who will produce the ‘Scrapping Certificate’ and registration fees will be waived off on the purchase of a new vehicle.
• Disincentive – As a disincentive, increased re-registration fees would be applicable for vehicles 15 years or older from the initial date registration.