Introduction

One of the widely discussed topics in the automobile industry is the Vehicle Scrappage Policy which was launched by PM Narendra Modi. Across the globe, various governments have implemented scrap policies for their citizens in collaboration with carmakers. India, however, has been rather late to the party, and it’s only now that a full-fledged scrappage scheme has been put into effect.

The new policy is being broadly seen as a move to help in improving the current unclear situation of old used cars that have surpassed their “shelf lives,” i.e., are older than 10-15 years. The Vehicle Scrappage Policy in India targets phasing out older and unfit vehicles which are hazardous to the environment. Read on to know more about it.

The objective of the Vehicle Scrappage Policy in India

The policy aims towards encouraging vehicle owners to replace their old, polluting vehicles with newer, more fuel-efficient, and less polluting ones. Experts predict that the policy will eventually benefit many industries and protect the environment.

To achieve the goal, an infrastructure will be built with automated testing of vehicles that have exhausted their registration period, which is 15 years for a passenger vehicle, and 10 years for commercial vehicles, as per law.

Benefits

The government has introduced a number of benefits to those who choose to scrap their vehicles. Some of them are as discussed below-

They will initially receive a scrap value that is equivalent to 4–6% of the ex-showroom cost of the new vehicle they plan to purchase. If the owners present their proof of deposit, they will pay no registration fees for their new vehicle. Also, it has been suggested that automakers provide a 5% discount on the purchase of new cars when the certificate of deposit is presented.

Also, the state government has been requested to grant concessions on the motor vehicle tax, which is reported up to 25% and 15% for non-commercial and commercial automobiles, respectively.

However, the benefits of the scrappage policy will also include a decrease in pollution and contribute towards a better environment. Also, buyers will experience greater travel safety because new cars have many more safety features than previous models. Additionally, the government-established auto recycling facilities would generate a significant amount of job possibilities.

Last but not least, recycling a lot of old cars will provide a lot of raw materials, boosting the precious metal and raw recycling sectors.

Rules for scrapping an old car

• Inform the RTO in writing why you have decided to scrap the car.
• By cutting the metal out of the chassis while scraping, give the registration certificate (RC) and the chassis number.
• Submit an affidavit stating that the vehicle is not subject to a loan, insurance claim, or ongoing legal action.
• It should be stated that the car is not associated with any criminal activity.
• Also, the concerned insurance provider needs to be informed about the scrapping.
• After the aforementioned procedures, the RTO examines the submitted document and obtains a no-objection certificate (NOC) from the National Criminal Records Bureau and the police (NCRB). The vehicle is deregistered by the RTO once all the paperwork has been completed in accordance with the guidelines of the Vehicle Scrappage Policy.

Conclusion

The Vehicle Scrappage Policy in India is the right step towards a cleaner and safer environment. Along with lowering pollution levels, it will also help the automobile industry grow and create more jobs. It will also improve road safety, increase fuel efficiency, and lessen the nation’s reliance on fossil fuels.

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