NEW DELHI: On August 27, Union Minister of Road Transport and Highways, Nitin Gadkari, announced that several commercial and passenger vehicle manufacturers will provide discounts for customers who scrap their old vehicles when purchasing new ones. This initiative is part of the Vehicle Fleet Modernisation Program aimed at promoting a circular economy.

Gadkari shared the news following a meeting with CEOs from the Society of Indian Automobile Manufacturers Association (SIAM), where key issues in the automotive sector were discussed. He announced on social media that manufacturers have agreed to offer discounts ranging from 1.5% to 3.5% for those who present a valid Certificate of Deposit upon scrapping their old vehicles.

This move is designed to encourage the replacement of older vehicles with newer, more efficient models, contributing to cleaner and safer roads. Gadkari expressed appreciation to the automakers for their participation in this program.

The National Vehicle Scrappage Policy, introduced by Prime Minister Narendra Modi in August 2021, aims to phase out outdated and environmentally harmful vehicles while fostering a circular economy. The policy, which began on April 1, 2022, allows states and Union Territories to offer up to 25% reimbursement on road tax for new vehicles purchased after scrapping old ones. Under the policy, commercial vehicles require fitness checks after 15 years, while personal vehicles must undergo checks after 20 years.

This policy and the new discounts are expected to bolster India’s position as a hub for vehicle scrapping in South Asia, benefiting both the environment and the automotive industry.

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