Vehicle scrapping policy
- February 2, 2023
- Posted by: OptimizeIAS Team
- Category: DPN Topics
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Vehicle scrapping policy
Subject : Schemes
Concept :
- The Union Budget for 2023-24 has laid special emphasis on vehicle scrapping policy by allocating adequate funds to replace vehicles that are over 15 years.
- Finance Minister Nirmala Sitharaman today announced that “adequate funds” have been allocated in the Union Budget 2023-24 to scrap and replace old vehicles of the central government.
- Also, the states will be supported in replacing old government vehicles and ambulances.
- The move is part of Prime Minister Narendra Modi government’s aim to support a green economy.
- In furtherance of the Vehicle Scrapping Policy, mentioned in the Budget 2021-22, I’ve allocated adequate funds to scrap old vehicles of the central government,” Sitharaman said.
Vehicle Scrappage Policy
- It was first announced in the Union Budget 2021-22.
- The Vehicle Scrapping Policy is aimed at creating an eco-system 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.
- Old and unfit vehicles whose life cycle is complete shall be scrapped. This will be a voluntary process but defined by rules.
- For instance, old vehicles (15 to 20 years) need not be scrapped compulsorily. However, they will have to undergo a fitness test after a defined period. Failing the test would most likely lead to vehicle scrappage.
- The policy would cover an estimated 51 lakh light motor vehicles (LMVs) that are above 20 years of age and another 34 lakh LMVs above 15 years of age.
- Rules and regulations will be made around the actual scrapping process, which shall be laid out in the announcement made by the MoRTH.
- Vehicle owners will be given certain benefits for scrapping old vehicles.
- As a disincentive, increased re-registration fees would be applicable for vehicles 15 years or older from the initial date registration.
- 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.