Minister for Road Transport and Highways Nitin Gadkari has announced the Vehicle Scrapping Policy in Lok Sabha last week. Making a suo motu statement in the Lok Sabha, the minister said that “Older vehicles pollute the environment 10 to 12 times more than fit vehicles and pose a risk to road safety.”Gadkari said that in the interest of a clean environment and rider and pedestrian safety, the Ministry of Road Transport and Highways is introducing the Voluntary Vehicle-Fleet Modernization Program (VVMP) or Vehicle Scrapping Policy which is aimed at creating an ecosystem for phasing out of unfit and polluting vehicles.
The objectives of the policy are to reduce population of old and defective vehicles, achieve reduction in vehicular air pollutants to fulfil 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.
The ecosystem is expected to attract additional investments of around Rs 10,000 crore and 35,000 job opportunities. The ministry will, in the next few weeks, publish draft notifications, which will be in the public domain for a period of 30 days to solicit comments and views of all stakeholders.
The criteria for a vehicle to be scrapped is primarily based on the fitness of vehicles through automated fitness centers in case of commercial vehicles and non-renewal of registration in case of private vehicles. The criteria is adapted from international best practices after a comparative study of standards from various countries like Germany, UK, USA and Japan.
A vehicle failing the fitness test or failing to get a renewal of its registration certificate may be declared as end of vehicle life. 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.
Vehicle Scrapping Policy aka Voluntary Vehicle-Fleet Modernization Program (VVMP)
It is proposed that commercial vehicles be de-registered after 15 years in case of failure to get the fitness certificate. As a disincentive measure, increased fees for fitness certificate and fitness test may be applicable for commercial vehicles of 15 year onwards from the date of initial registration.
Private vehicles will be de-registered after 20 years if found unfit or in case of a failure to renew registration certificate. As a disincentive measure, increased re-registration fees will be applicable for private vehicles of 15 year onwards from the date of initial registration.
All vehicles of the Central government, state government, municipal corporation, panchayats, state transport undertakings, public sector undertakings and autonomous bodies with the Union and state governments may be de-registered and scrapped after 15 years from the date of registration.
The scheme provides strong incentives to owners of old vehicles to scrap old and unfit vehicles through registered scrapping centers, which will provide the owners with a scrapping certificate. Some of these incentives include:
- Scrap value for the old vehicle given by the scrapping centre, which is approximately 4-6 percent of ex-showroom price of a new vehicle.
- 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.
- The vehicle manufacturers are also advised for providing a discount of 5 percent on purchase of new vehicles against the scrapping certificate.
- In addition, the registration fees may also be waived for purchase of a new vehicle against the scrapping certificate.
The Ministry of Road Transport and Highways (MoRTH) will promote setting up of Registered Vehicle Scrapping Facility (RVSF) across India and will encourage public and private participation for operating such centers. 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 specialized center for scrapping, among many other potential centers, where different scrapping technologies can be synergized together.
With a simplified registration process through single window, the scrapping facility will have to comply with environmental and pollution norms and with all applicable acts of law. It will be ensured that the scrapping centers have adequate parking facilities, de-pollution equipment for air, water and sound pollution and adequate facilities for hazardous waste management and disposal. Similarly, the ministry will promote setting up of automated fitness centers on a PPP model by state governments, private sector, automobile companies, etc.
These centers may have adequate space for test-lane, IT servers, parking and free movement of vehicles. To avoid conflict of interest, operators of fitness centers will only provide testing facilities and will not provide repair/sale of spare services. Appointment for fitness centers may be booked online and tests reports will also be generated in an electronic mode.
Tentative timeline for application of proposed scrapping policy
- Rules for fitness tests and scrapping centers: 1st October 2021
- Scrapping of government and PSU vehicles of above 15 years of age: 1st April 2022
- Mandatory fitness testing for heavy commercial vehicles: 1st April 2023
- Mandatory fitness-testing (Phased manner for other categories): 1st June 2024.
