As India tries to implement the much-awaited ‘Vehicle Scrappage Policy’, the ministry of road transport and highways have suggested a slew of incentives. The ministry’s rough estimates suggest scrapping personal vehicles older than 20 years and commercial vehicles over the age of 15 years could earn an incentive of around Rs75,000.
These include the proposed 4-5pc of the ex-showroom price for the scrapped vehicle; 25pc tax rebate on personal vehicles by state governments, 15pc for commercial; manufacturer rebate of 5pc, and a waiver of registration fees against scrappage certificate provided.
The ministry plans to promote the setting up of Registered Vehicle Scrapping Facilities (RVSF). Efforts are also on to set up integrated scrapping facilities. Alang has been identified as one of the places where there are talks of establishing a specialized center. The implementation of the policy would boost the manufacturing and industrial sectors and ensure low-cost raw material for the auto sector, believes the government.
At present, India has 5.1mn LMV’s which are older than 20 years, while the number of LMV’s older than 15 years is 3.4mn. There are about 1.7mn medium and heavy commercial vehicles older than 15 years.
Additionally, the government could increase RC renewal fees eight-fold for vehicles that are over 15 years old.