India's vehicle scrappage policy 2021 and how it bolster EV Sector.



Union Budget 2021-22 was announced and Finance minister Nirmala Sitharaman presented the budget. As an EV Enthusiast, the biggest point we can take away from the finance minister's speech is the official announcement of Vehicle scrappage policy in India. 

After the official announcement Union Minister for Road Transport and Highways Nitin Gadkari, shed some lights on highlights of the policy. More details of the policy is expected to be revealed in coming days.

In this article, you can read key points of India's vehicle scrappage policy and how it boosts EV Sector.

Key points of Vehicle Scrappage policy

1.  As per vehicle scrappage policy, private vehicles which are over 20 years older and commercial vehicles over 15 years older will have to undergo fitness tests.

2.  On Public Private partnership (PPP), Fully automated fitness test facilities will be set up which will allow no scope for human intervention or fudging of test result.

3.  Driving vehicles failed on Automated fitness test, results in substantial penalties such as vehicles could be impounded.

4.  Vehicles older than 8 years which passed on Automated fitness test, will be subjected to Green Tax. As per green tax, owners needs to pay additional 10 to 25 percent of road tax at the time of renewal of vehicle fitness certificate.

5.  Those who opt for voluntary scrappage scheme and got their old vehicle scrapped, will get benefits and incentives as part of the policy when they buy new vehicle. 

6.  The vehicle scrappage policy has been devised to promote sales of new vehicles with improved fuel efficiency and low pollution levels. Also to slash India's 10 lakh crore expenditure on crude oil imports.

7.  According to Union minister Nitin Gadkari, around 1 crore  aging vehicles are set to be scrapped once the policy implements.

8.  New policy will boost Indian Automotive Industry by 30% in coming years, Nitin Gadkari said.

9.  Around 50,000 jobs and investments of 10,000 crore are expected to be generated as a result of the policy.

10.  Union minister of Road transport and Highways said, India's Automotive segment  will be amongst those offering the highest employment opportunities in the country going forward.

Importance of this policy is more significant when we understand that old vehicles are estimated to cause 10-12 times more pollution than newer vehicle. This estimation is alarming to the sustainable future of our country and scrappage policy will help to reduce this to an extend.

How New scrappage policy Boosts Indian EV Sector

Automotive industry experts and EV Enthusiasts believes that scrappage policy will be a huge boost for electric vehicles in India. The Hindu reported that Director General of Society of Manufacturers of Electric vehicles, Mr. Sohinder Gill thanked the Finance minister for announcing the scrappage policy and said, it would help in encouraging the adoption of greener vehicles in India.

The scrappage policy will lead to dumping and scrapping of old polluting vehicles, which is a major challenge against greener and cleaner future. Also it will increase sales of new vehicles and electric vehicles will be one of the promising option among people buying new vehicles. New EV models launching and upcoming charging infrastructure gives people confidence to go with electric motoring.

Central and state govt. already announced promising subsidies for EVs in their EV Policies and this scrappage policy together will give common people a green signal to move forward with dumping old polluting vehicle and switching to EVs.

Though converting old vehicles to electric is a good option, converting cost will not entertaining as it cost around 5 - 7 lakhs to covert old car into electric depending on the range. Converting old two and three wheelers efficiently into electric is also costly process. Share your thoughts on the feasibility of older vehicles to electric.

Above listed key points are based on the reports by top magazines and best of the knowledge. Share your thoughts and Keep Reading.