Union Minister Nitin Gadkari Announces Incentives for Vehicle Scrapping

Key Highlights:

Manufacturers offering discounts on new vehicles in exchange for scrapping old vehicles

Need to create vehicle scrapping and fitness test centers

India’s potential to become a hub for scrapping in South Asia

National Vehicle Scrappage Policy facilitating the phasing out of unfit vehicles

Up to a 25% tax rebate on road tax for vehicles purchased after scrapping old vehicles

Fitness tests are required for personal vehicles and commercial vehicles after 20 and 15 years respectively

On Tuesday, Union Minister of Road Transport and Highways, Nitin Gadkari, announced that manufacturers of commercial and passenger vehicles have agreed to provide discounts on purchasing new vehicles in exchange for scrapping older vehicles with a valid Certificate of Deposit.

This decision was made during the SIAM CEO’s Delegation meeting chaired by Nitin Gadkari at Bharat Mandapam. The meeting addressed various critical issues faced by the automobile industry.

Last year, the minister stated that the country needs 1,000 vehicle scrapping centers and 400 automated fitness test centers.

India can be a scrapping hub

National Vehicle Scrappage Policy is beneficial for all parties involved. The minister mentioned that India has the potential to become a hub for scrapping in South Asia.

Nitin Gadkari Announces Incentives for Vehicle Scrapping — Gadkari emphasized the importance of the circular economy and its potential to create jobs in the country.

In August 2021, Prime Minister Narendra Modi launched the National Vehicle Scrappage Policy, stating that it would facilitate the phasing out of unfit and polluting vehicles while promoting a circular economy.

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As per the new policy, states and Union Territories (UTs) will offer up to a 25% tax rebate on road tax for vehicles purchased after scrapping old vehicles. The vehicle scrappage policy became effective from April 1, 2022.

The policy, announced in the Union Budget 2021-22, requires fitness tests for personal vehicles after 20 years and for commercial vehicles after 15 years.

ELCTRIK Speaks

It’s great to see the efforts being made to promote vehicle scrappage and create a more sustainable and efficient automotive industry. The incentives and policy initiatives seem promising and could positively impact the environment and the economy. This would encourage people to consider scrapping their old vehicles and transitioning to newer, more eco-friendly options.