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.