The vehicle scrapping policy will be a "win-win" policy that will eventually help in improving fuel efficiency and reduce pollution, Union minister Nitin Gadkari said on Thursday.
Gadkari unveiled the much-awaited Voluntary Vehicle-Fleet Modernization Program or “Vehicle Scrapping Policy” which is aimed at creating an eco-system for phasing out of unfit and polluting vehicles, in the Lok Sabha.
Making a statement regarding vehicle scrapping policy in the Lok Sabha, the Road Transport, Highways and MSMEs Minister said the policy will also lead to an increase in the country’s automobile industry turnover to Rs 10 lakh crore from the current Rs 4.5 lakh crore.
Announced in the 2021-22 Union Budget, the policy provides for fitness test after 20 years for personal vehicles, while commercial vehicles would require it after the completion of 15 years.
Gadkari has also issued an advisory to automakers, advising them to provide an incentive of a 5 percent rebate for those buying a new vehicle after producing a scrapping certificate.
Vehicle owners scrapping their old vehicles, could get “strong incentives” including a 25 per cent rebate on road-tax for personal vehicles, and 15 per cent for commercial vehicles, a 5 per cent discount on purchase of new vehicle against the scrapping certificate, among others, said Gadkari. .
Noting that the policy will be a "win-win” policy, the minister said it will help improve fuel efficiency, reduce pollution and GST income will also rise due to the purchase of new vehicles.
“We're introducing Voluntary Vehicle Fleet Modernisation Program, which would scrap old vehicles & support people economically while buying new vehicles. Scrap centers, auto industry, components industry will be benefitted from this policy.The objectives of the policy are to reduce population of old and defective vehicles, achieve reduction in vehicular air pollutants to fulfill India’s climate commitments, improve road and vehicular safety, achieve better fuel efficiency, formalize the currently informal vehicle scrapping industry and boost availability of low-cost raw materials for automotive, steel and electronics industry,” Gadkari said.
There're 51 lakh vehicles older than 20 yr, 34 lakh vehicles older than 15 yr & about 17 lakh vehicles older than 15 yr without vehicle fitness certificate. Compared to fit vehicles, old vehicles pollute air 10-12 times more & risky for road safety, he said.
Meanwhile, the government has proposed a new take on re-registering vehicles that are more than 15 years old. The fees for the renewal of registration has been increased drastically in the draft notification.
The charges for a fitness certificate has also been increased in the draft. The Central Motor Vehicle (Amendment) Rules, 2021 that was issued by the Road Ministry will come in effect from October 1, 2021.
The rules for fitness tests and scrapping centres will come into effect 1st October this year onwards, while scrapping of government and PSU vehicles above 15 years of age will be in effect 01st April 2022 onwards. The mandatory fitness testing for heavy commercial vehicles will be in effect 1st April 2023 onwards, and the mandatory fitness testing for other categories will come in a phased manner 1st June, 2024 onwards.
Currently, the stakeholders have been asked to submit their feedback on the new draft.They have been given 30 days to submit their feedback.
The new proposed renewal fee for a 15-year-old two-wheeler has been set to Rs. 1,000 whereas currently, it is only Rs. 300. If it is a 3-wheeler or a quadricycle then you would need to pay Rs. 2,500 for the renewal fee.
For imported vehicles, the renewal registration amount has been set at a higher amount of Rs. 40,000. The owner would be required to renew the registration certificate every 5 years after 15 years.
The amount for a cab or a taxi has been set to Rs. 7,000. For the medium goods/passenger category the owner has to pay Rs. 10,000 whereas if it is a heavy goods/passenger then the he would need to shell out Rs. 12,500 for the renewal of the fitness certificate.
This amount is almost 21 times higher than the current amount that you need to pay to renew the fitness certificate. The fitness certificate renewal for the commercial vehicles will be mandatory every year once the vehicle attains eight years.
All of this is being done to discourage the use of old vehicles as they pollute more than modern vehicles.
The criteria for a vehicle to be scrapped is primarily based on the fitness of vehicles through Automated Fitness Centres in case of commercial vehicles and Non-Renewal of Registration in case of private vehicles, Gadkari said.
The criteria has been adapted from international best practices after a comparative study of standards from various countries like Germany, UK, USA and Japan, he added.
A vehicle failing the fitness test or failing to get a renewal of its registration certificate may be declared as End of Life Vehicle, as per the proposed policy. Criteria to determine vehicle fitness will be primarily emission tests, braking, safety equipment among many other tests which are as per the Central Motor Vehicle Rules, 1989.