Vehicle Scrappage Policy in India
Does that mean you have to scrap your vehicle?
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Are there any rules and regulations about the vehicle scrappage scheme?
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Well, read below to get an insight into the policy of scrapping old vehicles in India.
What is Vehicle Scrappage Policy in India?
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The Vehicle Scrappage Policy is a government-funded programme to scrap old and unfit vehicles and replace them with modern and new vehicles on Indian roads. The primary goal of the policy is to create an ecosystem for phasing out unfit and polluting vehicles to achieve a lower carbon footprint in the country.
Highlights of the Vehicle Scrappage Policy Announcement
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The Indian automobile sector has been in a troubled zone since the latter half of 2019. The following COVID-19 pandemic made the situation even worse. Although post-Diwali sales in 2020 have uplifted the sector to an extent, the situation is still worrisome. The scrappage policy is said to help the struggling automobile sector in India. With old vehicles being phased out, there will be a demand for new vehicles. Scrapping unfit vehicles will also benefit the environment.
Here’s a list of key highlights related to the Vehicle Scrappage Policy announcement.
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The policy is directed towards building a system to scrap unfit vehicles in India.
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Rules and regulations will be made around the actual scrapping process, which shall be laid out in the announcement made by the MoRTH.
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Vehicle owners will be given certain benefits for scrapping old vehicles.
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The scrapping of unfit vehicles will help reduce air pollution to a considerable extent (subjective as per location).
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People will look forward to buying environment-friendly, safe, and technologically advanced vehicles.
What is the aim of Vehicle Scrappage Policy 2021?
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The main objective of the Vehicle Scrappage Policy 2021 is to identify old, unfit and polluting vehicles and scrap them. Here are some of the key takeaways of the vehicle scrappage scheme.
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Reduce pollution by scrapping vehicles without valid fitness and registration.
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Improve passenger, road and vehicular safety.
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Generate employment in the automobile industry.
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Formalise the current informal vehicle scrappage industry.
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Improve fuel efficiency and reduce maintenance costs for vehicle owners.
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Increase availability of low-cost raw materials for automotive, steel and electronics industry.
Benefits of the Vehicle Scrappage Policy
Here’s a list of potential benefits of the new vehicle scrap policy for the economy, automobile sector, vehicle owners, and others.
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Scrapping unfit vehicles will result in less air pollution and better air quality.
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With old vehicles being scrapped, the demand for new vehicles will rise as the old ones will need to be replaced by new ones. More than 51 lakh light motor vehicles (private and commercial) are more than 20 years old.
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Overall, the automobile sector will benefit from the new scrappage policy leading to more job opportunities. For example, new vehicle scrapping centres will need manpower.
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New advanced vehicles will be comparatively safer. For example, new cars come with superior safety features.
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The recycling industry will also be more active leading to higher revenue.
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Vehicle owners might receive tax benefits as an incentive to scrap an old vehicle.
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Vehicle owners might also get the best price for car scrappage for workable parts such as tyres.
What Happens to the Car at the Scrapping Facility?
At the scrapping facility, the car is stripped down and the parts are segregated. The fluids are also drained out such as the fuel, engine oil, brake oil, etc.
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After this, the tyres, wheels, and battery are removed. The infotainment system, engine, alternator, transmission, and the mechanical or electronic subassemblies might be serviceable and can be sold later.
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It is a labor-intensive manual job. When done properly it surely increases the scrapping centers' profit margins. When the car has stripped most of the parts, further processing is done. The pipes, ac unit, and a heater core that are intact often can be also salvaged. The plastic and glass bits are removed and the paint is sanded off. The remaining shell gets crushed, then shredded, and recycled to form a new metal.
