India’s vehicles scrappage policy: Explained In 4 points
The launch of "Voluntary Vehicle-Fleet Modernization Programme or India's vehicle scrapping program," aims to bring in a new era of what it means to own and operate an automobile in the country. Road Transport & Highways Minister Nitin Gadkari introduced it in Parliament in March. Prime Minister Narendra Modi announced the policy at an investor summit in Gujarat on Friday, saying it will help phase out unsuitable and polluting cars in an eco-friendly manner.
What is India’s vehicle scrappage policy?
This policy proposal aims to phase out unsuitable cars to decrease vehicular pollution, fulfill climate commitments, enhance road safety and fuel efficiency, formalize the informal vehicle scrapping sector, and reclaim low-cost material for the steel, automotive and electronics industries. The initiative is expected to create employment and attract investment.
It has urged the state government to waive 25% of personal vehicle road tax and 15% of commercial vehicle road tax, as well as registration costs. Vehicle manufacturers have also been encouraged to offer a 5% discount on new vehicle purchases in consideration of scrapping certificates.
The Union Ministry of Road Transport and Highways would assist in the establishment of registered car scrapping facilities, including integrated vehicle scrapping facilities, with public-private involvement, as well as ensuring adherence to environmental rules for waste disposal. This will allow for the installation of technologies to tackle pollution, the control of water and sound pollution, and the management of hazardous waste.
The criteria for fitness testing and scrapping must be in place by October 1, 2021, according to the proposed policy's milestones. By October 1, 2022, all government and PSU-owned cars older than 15 years will be scrapped. Heavy-duty vehicles will be required to undergo fitness testing by October 2023, while other vehicles will be required to do so by October 1, 2024.
According to reports, scrapping centers will retain records and use the VAHAN database to authenticate car ownership. Vehicles that have been destroyed by fire, riots, or other forms of destruction, and those that have been certified faulty by manufacturers and seized by law enforcement authorities, will have to be scrapped.
50 lakhs light motor vehicles are over 20 years old, and 33 lakhs are over 15 years old. Approximately 16 lakh medium and heavy trucks are over 15 years old. These unfit vehicles produce more than 10-12 times the amount of pollutants than well-maintained vehicles.
What is a circular economy?
A circular economy relies on resource reuse, sharing, repair, refurbishing, remanufacturing, and recycling to produce a closed-loop system that reduces resource consumption, waste generation, pollution, and carbon emissions.
Apart from metals such as iron and steel, numerous other elements may emerge from a scrapped automobile that may be reconditioned and put back into use. Scrap steel, including seats and plastic parts, has a market value in the scrap economy.
In a circular economy, products, resources, equipment, and infrastructure are used over extended periods thus, increasing productivity.
Why should I scrap?
The government anticipates that the scrappage certificate will entitle the owner to something additional, such as a tax rebate and a discount on a new automobile, to enable vehicle owners to find a reason to retire old vehicles. The certificate is transferable, meaning anybody may use it, not only the owner of the scrapped vehicle.
Does it help the economy?
Scrappage policies have boosted demand in the vehicle manufacturing sector across the world, particularly in Europe and the United States. This has also served as a strategy for dealing with the manufacturing sector's slowdown and the recession's impact on consumer spending. Furthermore, there are clear environmental benefits, as modern automobiles have better pollution regulations and are more fuel-efficient.
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