Prime Minister Modi launched the Vehicle Scrappage Policy today on 13th August, 2021. The policy was initially presented by the Finance Minister Nirmala Sitharaman at the Union Budget 2021. The details of the policy were soon revealed by Nitin Gadkari, Union Minister for Road, Transport and Highways. The new scrappage policy is voluntary, it would still require mandatory fitness tests for vehicle after certain specified duration. Let us look into the details of this much awaited Vehicle Scrappage Policy and the benefits of it.

The scrappage policy comes into effect after the completion of a vehicle’s registration. A passenger vehicle has a life of 15 years and a commercial vehicle has a life of 10 years after which they become obsolete. A vehicle should be scrapped at the end of its lifecycle so that it is stopped from running on roads. This will reduce air pollution.

In the western countries, the obsolete vehicles are sent to the scrapyards. They are then dismantled and the steel is taken for recycling. Since India did not have any policy of this nature, the obsolete vehicles are running on the roads and creating pollution or lying somewhere becoming more of a dwelling place for notorious elements, play room for kids or getting rusted.

Now that the policy has been made, the scrapping process will start for which Automated scrapping centres will be built within 200 km of every RTO in the country. Not all vehicles will be scrapped as this is a voluntary scheme. All vehicles over and above the lifecycle (10 years and 15 years) will have to undergo mandatory fitness test. If a vehicle fails fitness test, it will not get the renewal certificate and won’t be able to run on road. However, if it passes the fitness test, it will have to undergo fitness test after every 5 years again to show its worthiness on the road.

The Union Minister for RTH has given the following financial benefits one can get from the policy:

1) A scrap value of the ex-showroom price of vehicle ranging from 4-6% will be given to the owner if they choose to scrap the vehicle

2) A rebate of upto 25% will be given in Road Tax

3) Vehicle manufacturers will be advised to give 5% discount on new vehicles against a scrapping certificate

4) No registration fees for vehicles

A fitness test determines the road worthiness of a vehicle and checks if the vehicle is polluting the environment. Various other tests like brake test, engine performance among others will be in place to check the quality of the vehicles. A fitness test will be conducted at the automated fitness centres.

These centres will be established under PPP model. It is estimated that each fitness test will set you back by at least Rs 30,000-40,000 and a green cess will also be levied while renewing the vehicle registration. The government is hoping that all these additional costs will dissuade vehicle owners from retaining the vehicle.

If the vehicle doesn’t pass the test, a renewed registration certificate will not be issued which means that the vehicle is not registered to run on the road. As per the Motor Vehicle Act, it is illegal to drive a car without RC. Reports suggest that you can undertake a fitness test only three times post which your vehicle will not be road worthy.

The policy has been launched by PM Modi today and it will take some time to implement the policy on the ground level as scrapping centres are not ready yet. “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,” said Giridhar Aramane, secretary in the road transport and highways ministry.

(source and inputs:news18)