When Nitin Gadkari, Minister for Road Transport and Highways and MSME, spelt out the contours of India’s first vehicle scrappage policy in mid-March, it was the culmination of a process that started more than a decade ago. The multipronged policy, which seeks to replace ageing and outdated vehicles in favour of modern and more technologically advanced versions on the road, would effectively come into force only from June 1, 2024 when fitness tests become mandatory for most cars and SUVs. Under the new policy, the Ministry of Road Transport and Highways has advised automobile manufacturers to provide a 5 per cent discount on the purchase price of a new car for anybody who buys them after scrapping the old vehicle. It has also asked state governments to waive off registration fees on the new vehicle. This will be on top of the scrap value of the old vehicle, which could be anywhere around 4-6 per cent of the ex-showroom price of a new car. For heavy commercial vehicles, fitness tests will become mandatory from April 1, 2023.
It could still be anti-climatic, though. Voluntary in nature, the policy announced so far feels more like a work in progress than a finished product. None of it is binding as of now. In automotive parlance, it is akin to a clay model and not a metal body. From his own end, Gadkari has requested the finance ministry to offer some rebate in Goods and Services Tax (GST), but a response is awaited.
It does not, however, undermine the importance of the policy itself, or its potential to solve multiple problems at the same time. The biggest of them is reducing carbon footprint and cleaning up the environment. There are an estimated 68 lakh vehicles currently plying on roads that are older than 15 years and can potentially be scrapped. A significant number of them do not conform to any significant emissions regulations — India embarked on a formal emissions road map only in 2000. These numbers would rise exponentially when a similar policy for two-wheelers, which is also in the works, is ready.
No. of old cars, trucks, and buses that may potentially be scrapped. They emit 10-12 times more than fitter modern vehicles
What happens when a 10-year-old truck is replaced by a new BS Vi-compliant truck on the road?
28 per cent
Reduction in particulate emission
18 per cent
Reduction in hydrocarbon and nitrogen oxide emissions
17 per cent
Reduction in carbon dioxide emissions
50 per cent
Reduction in carbon emissions in steel-making when 97 per cent recycled steel is used instead of iron ore
Landfill site that can be saved by recycling vehicles
165 million tonnes
India’s projected annual waste generation in 2030, against 62
MT in 2019
Projected fresh investment towards setting up fitness centres and scrapping facilities
Employment opportunity in the new business
Continue reading your story on the app
Continue reading your story in the magazine
AS BUSINESS CAME TO A STANDSTILL DURING LAST YEAR’S LOCKDOWN, FOOD RETAIL COMPANIES AND RESTAURANTS EMBRACED TECHNOLOGY TO STAY AFLOAT
THE PANDEMIC HAS FAST-TRACKED ADOPTION OF SMART HEALTHCARE SOLUTIONS GLOBALLY
The 5G Dilemma
THE PANDEMIC HAS OPENED A FRESH DEBATE AROUND THE FUTURE OF 5G IN INDIA. INFRASTRUCTURE REQUIREMENTS COULD FURTHER DELAY ITS LAUNCH
IT For A New World
HOW THE INFORMATION TECHNOLOGY INDUSTRY IS LOOKING TO SERVICE A WORLD WITH NEW RULES, HABITS AND BEHAVIOUR
Marriage of Convenience
FROM DISRUPTERS TO PARTNERS, THE FINTECH-BANK RELATIONSHIP HAS COME A LONG WAY. WHAT IS THE NEXT LEVEL OF THIS PARTNERSHIP?
Highways Sans Toll Plazas
FUTURE TOLL COLLECTION WILL BE BASED ON GLOBAL POSITIONING TECHNOLOGY. A PILOT PROJECT IS ALREADY ON WITH 500 VEHICLES
Digital Key to Pandemic Response
TECHNOLOGY HAS EMERGED AS THE LIFELINE OF SOCIETIES AND ECONOMIES
Classes Go Hi-Tech
HOW TECHNOLOGY HAS TRANSFORMED THE WAY EDUCATIONAL INSTITUTIONS FUNCTION
Big Data's Healing Touch
HOW AI AND DATA ANALYTICS ARE CHANGING HEALTHCARE INDUSTRY DYNAMICS
The Future Is Electric
The pandemic has not impacted the electric vehicle story adversely. In fact, it may have accelerated the shift