Registration Of Old Vehicles To Be Raised By 2400%; Govt. Will Pay You For Scrapping Old Vehicles!
As per the reports coming in, Soon India would be getting its vehicle scrappage policy. The final draft is prepared by Road Ministry and ready to be presented in Union Cabinet meeting in the near future.
Why This Policy?
Scrapping Policy is basically a government-funded program to encourage replacement of old vehicles with the latest ones which are much better in technology and causes less harm to the environment.
The program is intended to give a necessary boost to the auto industry and also will help in taking older vehicles off the road.
Vehicle scrappage policy is implemented by many countries. Mostly they came in effect from global economic recession during 2008 to boost demand in the manufacturing industry.
There are many examples like Vehicle Incentive Programme in Canada, Car Allowance Rebate System in the United States and many other countries across the world have implemented this policy.
Indian government has been thinking about the scrapping policy for a while as it can keep a check on pollution caused due to the use of old vehicles.
What Does This Policy Contain?
It is going to be a government-funded program to encourage the replacement of old vehicles with the latest ones. The new ones are expected to help in reduction of pollution and creating new jobs in the time of slow economy.
Soon this policy will be sent to the next Union Cabinet meeting for further approval. The policy is aimed towards reducing the pollution levels by removing operation of 15-year-old vehicles from the road.
With the implementation of this, the demand for new vehicles will give a much-needed boost to the auto industry as it is supposed to increase the demand as old vehicles will be needed to be replaced by modern ones.
Who Will Get Affected?
According to reports, the draft will be considering scrappage policy for vehicles older than 15 years.
The hike in registration fees for vehicles older than 15 years will be increased to Rs 15,000 from earlier fee of Rs 600.
Also the re-registration fees will be raised to Rs 40,000 which is currently Rs 1,500 for such vehicles.
As per the Central Motor Vehicle Rules, all private vehicles need to be re-registered after 15 years for every 5 years, for as long as it is considered roadworthy by the department.
If the vehicle is not re-registered after 15 years, It will be automatically deregistered and will lead to a penalty.
Also, they are planning to alter the road tax in order to make the operation of older vehicles less attractive.
What Will Change?
The Ministry has proposed a draft policy in July, that says that buyers wouldn’t have to pay the registration fee for new vehicles if they present scrapping certificate issued by an authorised scrapping agency.
According to them, new business and job opportunities will be formed as there will be a requirement to open scrapping centers across the country.
Recently Indain auto major, Mahindra has announced a partnership with Metal Scrap Trade Corporation Ltd (MSTC) and started scrapp centers named Mahindra Accelo.
Which is going to be the first government-authorized scrap center in India. (reference News18)
This may seem like a good idea for boosting sales in the auto industry and creating new jobs in a slow economy.
But it may upset the people belonging to transport industry, because they will have to scrap their old vehicles and will need a large investment to replace them with new ones.