India’s Vehicle Scrappage Policy, which came into effect in April 2022, represents a government-funded initiative with the primary goal of phasing out aged passenger and commercial vehicles. The overarching objectives include reducing urban air pollution, enhancing passenger and road safety, and boosting vehicle sales within the country.
Under this policy, passenger vehicles older than 20 years and commercial vehicles older than 15 years are required to undergo a rigorous “fitness and emissions test” to maintain their registration. Vehicles failing this mandatory examination are deemed end-of-life vehicles, resulting in the loss of their registration certificates and a recommendation for scrappage. To further incentivize the scrapping of old vehicles, the policy introduces benefits such as discounts on the purchase of new vehicles when accompanied by a valid scrappage certificate.
This policy has the potential to bring about significant changes in India’s automotive sector. Firstly, it establishes national norms governing vehicle phase-out, improving insights into vehicle retirements and standardizing registration rules across states. Secondly, the policy aims to expedite the formalization of vehicle scrappage and recycling processes. The successful implementation of this policy is contingent upon the availability of testing centers and scrappage yard capacity.
