There is good news for consumers who are going to junk their old vehicles and buy a new one under the Vehicle Scrapping Policy as automakers will give about a 5 percent rebate on the new purchase, Union minister Nitin Gadkari has said.
The voluntary vehicle scrapping policy announced in the Union Budget for 2021-22 provides for fitness tests after 20 years for personal vehicles while commercial vehicles would require it after the completion of 15 years.
“Automobile manufacturers will provide about 5 percent rebate on new car purchases” to the consumers in lieu of scrapping of the old, Road Transport, Highways and MSMEs Minister Gadkari told PTI.
“There are four major components of the policy…Apart from the rebate, there are provisions of green taxes and other levies on old polluting vehicles. These will be required to undergo mandatory fitness and pollution tests in automated facilities. For this automated fitness centers would be required throughout the country and we are working in that direction,” Gadkari said.
Automated fitness tests will be set up under public-private partnership (PPP) mode while the government will assist private partners and state governments for scrapping centers, he said.
Driving such vehicles that fail to pass automated tests will attract huge penalties and also be impounded, the minister said.
This policy is going to be a boon for the automobile sector, making it one of the most profitable sectors which in turn would generate huge employment, the minister said.
The policy is touted as a major step to boost the Indian automobile sector, reeling under the adverse impact of the COVID-19 pandemic.