Nitin Gadkari Announces Vehicle Scrapping Policy In Lok Sabha, Calls It 'Win-Win' Situation

Gadkari, who was speaking in the Lok Sabha, termed it a “win-win” situation and said the “vehicle manufacturers are advised for providing a discount of five percent on purchase of new vehicle against the scrapping certificate”.

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New Delhi: Union Road, Transport and Highways Minister Nitin Gadkari on Thursday said the ‘Voluntary Vehicle-Fleet Modernisation Programme’ or ‘Vehicle Scrapping Policy’ will offer about five percent rebate to buyers on new car purchases in lieu of scrapping of the old.

Gadkari, who was speaking in the Lok Sabha, termed it a “win-win” situation and said the “vehicle manufacturers are advised for providing a discount of five percent on the purchase of new vehicle against the scrapping certificate”.

Gadkari, who is also the Union Minister for Micro, Small and Medium Enterprises (MSMEs), said this policy will result in an increase of about Rs 40,000 crore in the GST.

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“The scheme shall provide strong incentives to owners of old vehicles to scrap old and unfit vehicles through registered scrapping centres, which shall provide the owners with a scrapping certificate,” he added.

The Union Minister while listing the incentives said scrap value for the old vehicle given by the scrapping centre will be approximately four to six percent of ex-showroom price of a new vehicle.

Gadkari said the state governments may be advised to offer a road tax rebate of up to 25 percent for personal vehicles and up to 15 percent for commercial vehicles.

Asserting the Ministry of Road Transport and Highways will promote the setting up of Registered Vehicle Scrapping Facility (RVSF) across India and will encourage public and private participation for opening up of such centres, he said efforts are also being made to set up Integrated Scrapping Facilities across India.

“Some of the identified places include Alang in Gujarat, where it is being planned to develop a highly specialised centre for scrapping among many other potential centres, where different scrapping technologies can be synergised together,” PTI quoted Gadkari as saying.

The Union Minister further said the scrapping facility through a single-window shall have to comply with environmental and pollution norms and with all applicable acts of law with a simplified registration process.

Gadkari added the ministry shall also promote the setting up of automated fitness centres on a PPP model by the state government, private sector and automobile companies.

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Expressing confidence, the Union Minister said the ecosystem is expected to attract additional investments of around Rs 10,000 crore and 35,000 job opportunities.

Gadkar also tweeted in this regard later.

“The @MORTHIndia introducing the 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,” he said.

<blockquote class="twitter-tweet"><p lang="en" dir="ltr">The <a href="https://twitter.com/MORTHIndia?ref_src=twsrc%5Etfw" rel='nofollow'>@MORTHIndia</a> introducing the Voluntary Vehicle-Fleet Modernization Program or &#39;Vehicle Scrapping Policy&#39; which is aimed at creating an Eco-System for phasing out of Unfit and Polluting Vehicles.</p>&mdash; Nitin Gadkari (@nitin_gadkari) <a href="https://twitter.com/nitin_gadkari/status/1372506671713447941?ref_src=twsrc%5Etfw" rel='nofollow'>March 18, 2021</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

The Voluntary Vehicle Scrapping Policy announced in the Union Budget for 2021-22 provides for fitness test after 20 years for personal vehicles while commercial vehicles would require it after the completion of 15 years.