Prime Minister Narendra Modi, announced the long anticipated National Automobile Scrappage Policy. The policy calls for private and commercial vehicles, that are more than 20 and 15 years old, respectively, to undergo ‘fitness tests.’
The policy, which PM Modi launched while virtually addressing the Investor Summit in Gujarat, was announced by Union finance minister Nirmala Sitharaman in her Budget speech in February.
Things to know about the National Automobile Scappage Policy:
- The policy mandates “fitness tests” for private as well as commercial automobiles that are more than 20 and 15 years old respectively. Without a “fitness certificate,” registration of such automobile vehicles will be automatically cancelled.
- Mandatory Scrapping of all Government 4-Wheeler Vehicles that are more than 15 Years Old.
- The scheme also proposes several incentives which the owners can avail after being given a scrapping certificate. This includes the scrap value for the old vehicle, which is expected to be around 5-6% of the price of a new vehicle.
- A road tax rebate of up to 25% for new personal vehicles, and 15% for new commercial vehicles, as well as a 5% discount against the scrapping certificate, have also been proposed under the policy.
- The registration fees for the purchase of a new vehicle may also be waived upon getting the old vehicle scrapped.
- The policy will bring investments worth more than ₹10,000 crore and create up to 50,000 jobs, Union transport minister Nitin Gadkari had said while announcing details of the policy, in March.