New Delhi: A revolutionary scheme to do away with old vehicles has been in the works for a while. The Union Ministry of Road Transport and Highways has been keen to implement a policy that will make it mandatory to convert 15-year-old vehicles into scrap.
The scrappage policy is set to bring about a host of benefits including savings on iron imports, protecting the environment and eliminating eyesores in the form of rusting vehicles.
Union Surface Transport Minister Nitin Gadkari had a couple of days ago hinted that the scrappage policy might be approved soon.
The process
The vehicle scrap will be given as raw material to vehicle manufacturing companies. This will ensure cheaper steel and other input products for automakers in the country, resulting in a fall in prices of new vehicles.
Once the policy is approved, the country is expected to become a low-cost vehicle manufacturing hub. The vehicle manufacturing industry has a total turnover of Rs 4.5 lakh crore, including exports of Rs 1.45 lakh crore.
Rs 25,000 crore saving for govt
It is estimated that the central government will be able to save a whopping Rs 25,000 crore a year on iron imports made for the automotive sector.
Environmental benefit
The new system is also expected to help protect the environment. With the implementation of the policy, there will be a permanent solution to the piling up of rusting vehicles around police stations, excise offices and on roadsides close to residential homes.
Get paid as you junk old cars
The scheme is a win-win for all stakeholders. Customers will be able to dispose of older vehicles from their compounds and will also get paid for them. The current practice is to take whatever is offered for old cars. When the new system comes into effect, there will be proper benchmark for scrap sale too.
The iron prices for two, three, four-wheelers and large vehicles to be scrapped are yet to framed.
The owner of the old vehicle will also be given a subsidy for the new vehicle as per the proposed policy.
Separate portal for the scheme
The system will be implemented through a separate vehicle portal. Vehicles that are older than 15 years should be deregistered on the portal of the Union Surface Transport Ministry.
