The Ministry of Road Transport and Highways (MoRTH) has proposed the mandatory de-registration of private vehicles after 20 years if the fitness certificate is not renewed, Union minister Nitin Gadkari said on March 18.
Under the vehicle scrappage policy, the ministry has similarly proposed the de-registration of commercial vehicles after 15 years if the owners fail to renew the fitness certificates.
The MoRTH has also proposed to mandatorily de-register the government vehicles after 15 years, if the fitness certificate is not renewed.
The government vehicles include those used by the central and state governments, municipal corporations, state transport bodies and autonomous bodies of the states and the Centre.
Also read: Vehicle scrapping policy will be 'win-win' policy; to help reduce pollution: Nitin Gadkari
The vehicle scrappage policy, as part of which the private, commercial and government vehicles would be required to undergo fitness tests, is aimed at reducing pollution and providing a spurt to the automobile sector.
The scrappage policy is expected to increase the government revenue in form of Goods and Service Tax (GST) by Rs 30,000-40,000 crore, on account of higher vehicle sales, Gadkari said.
The minister claimed that he has urged the Finance Ministry to "consider reduction in GST tax rate on automobiles" as scrappage policy will boost sales of vehicles.
Gadkari on March 18 laid out the framework of the vehicle scrappage policy in Lok Sabha. The minister also urged all vehicle manufacturers to give a 5 percent discount on purchase of new vehicles to those who have given their vehicles for scrappage.
The road minister also suggested that state governments should offer a road-tax rebate of up to 25 percent for personal vehicles, and up to 15 percent for commercial vehicles.
His suggestions include waiving the registration fees of the new vehicles which are purchased against a scrapping certificate.
India currently has over 5 million light motor vehicles which are older than 20 years, and around 3.4 million light motor vehicles which are older than 15 years. Around 1.7 million medium and heavy commercial vehicles are older than 15 years, and are plying without a valid fitness certificate.
Such older vehicles pollute the environment "10 to 12 times" more than fit vehicles and pose a risk to road safety, the minister said a statement.
The government also plans to set up integrated scrapping facilities across the country, where vehicles will undergo a fitness test. The parameters of the test include vehicle emission, braking and safety equipment.
Vehicles that fail the fitness test will be deemed as end of life and those that are older than 15 years will be mandatorily de-registered. The scrap value for the old vehicle is likely to be 4-6 percent of the ex-showroom price of a new vehicle.
The government will tentatively release the rules for fitness tests and scrapping centres by October 1, and the scrapping of government and government-owned vehicles which are more than 15 years old will start from April 1, 2022.
This will be followed by the mandatory fitness testing of heavy commercial vehicles from April 1, 2023. The mandatory testing of other categories of vehicles will take place in a phased manner from June 1, 2024.
While the scrappage policy would be applicable on commercial, private and government vehicles, the "vintage vehicles would be exempted", Gadkari said. The MoRTH will come out with a separate policy for vintage vehicles, he added.
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