Prime Minister Narendra Modi on August 13 flagged off the Voluntary Vehicle Fleet Modernisation Programme, or the automobile scrappage policy.
During a virtual address at the Investor Summit in Gujarat, PM Modi said that the vehicle scrappage policy will bring in investments of around INR 10,000 crore. Alang in Gujarat can become hub for vehicle scrapping, he further added.
He also called for the support of youth and start-ups as while requesting them to join the programme.
He also underlined how the current method of scrapping of materials was not productive. The vehicular scrappage policy would help remove unfit and polluting vehicles in an environment friendly manner, he said.
Also present in the event was Union Minister for Road Transport & Highways Nitin Gadkari, who said that the scrappage policy will likely cut down raw material costs by around 40 percent.
Mr Gadkari also that according to an estimate, with increased sale of automobiles due to the lauch of the vehicle scrappage policy, the government will get a profit of INR 30,000- 40,000 crore in GST.
“Around 99 percent of recovery (metal waste) can be done with regular scrapping. It will also bring down cost of raw material by approx 40 percent. It will make components less expensive and increase our competitiveness in international market.”~Nitin Gadkari , Union Minister for Road Transport & Highways
The minister also said that the policy will help India become an industrial hub of automobile manufacturing.
He also said that testing centers will be setup in all districts across the country using the public private partnership (PPP) model.
The policy is aimed at incentivising owners of old and polluting vehicles to take them off the road. Commercial vehicles that are over 15 years old and personal vehicles that are more than 20 years old will be eligible for scrapping.
The policy will be first implemented for government-owned vehicles, and then for heavy commercial and personal vehicles.
“We propose to scrap vehicles, which are 15 years and over, owned by the Central and state governments by April 2022,” said Giridhar Aramane, Secretary in the road transport and highways ministry, in a separate statement.
“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, we plan to implement this from June 2024 onwards.”
The policy intends to create scrapping infrastructure in the form of Automated Testing Stations and Registered Vehicle Scrapping Facilities across the country.