New Scrappage Policy Launched: What Mr. Gadkari Says On It

New Delhi: PM Narendra Modi announced a new scrappage policy on Friday. It is also known as Voluntary Vehicle-Fleet Modernization Program (VVMP). The new scrap policy will bring many new changes across the country, ranging from increased new auto sales to reducing pollution and limiting the road accidents that have been a significant reason for deaths in India.

The Prime minister stated that the vehicle scrappage policy will bring an investment of around INR 10,000 crore to set up 450-500 automated testing stations and 60-70 registered vehicle scrapping facilities across the country. 

However, the process is huge but worth it as it will come up with many good changes in the country. 

Taking the new policy into account, Nitin Gadkari, current Union Road Transport and Highways Minister, said on Tuesday, it can help boost new vehicle demand in the country by 25-30%.  

He added, “Stressing that the policy was a ‘win-win’ for all stakeholders, including customers, industry, and the government. Minister also stated that the new policy would help India become the top-most manufacturing hub in the next five years. 

“There are about 1 crore end-of-life vehicles in the country, according to the three years old data. People will not buy new vehicles if they don’t scrap the old vehicles” Gadkari commented.

He also explained that reduction of road tax by up to 25% is not just advisory. “We are authorized under the concurrent list to decide the principle of taxation. Scrappage policy will increase  revenue for the State Government as there will be a 25-30% increase in auto sales and they will get GST. The Center Government will get INR 40,000 crore each, Employment will increase, and pollution will decrease,” he clarifies. 

Mr. Gadkari has also requested the automobile sector to give up to 5% discount on new models as an incentive for customers to scrap old vehicles.  

In addition to this, Amit Varadan, joint secretary, said that the Ministry had estimated savings of about INR 1.15 lakh in five years on new vehicles purchased following the scrapping of old vehicles. This could increase up to INR 8.32 lakh in the same period for trucks. 

Mr. Nitin Gadkari said that India imports about INR 3 lakh crore worth of metal, which can be reduced or even eliminated if people dispose of their old vehicles and follow the New Scrap Norms seriously. 

The Minister said, on scrapping centers, the government should envision that there should be scrapping and a fitness center in every district. It is necessary to follow the norms strictly and there would be no errors in following the policy and disposing of old vehicles.

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