Vehicle Scrappage Policy Could Be Introduced Very Soon, Says Nitin Gadkari

vehicle vintage scrapping policy

The upcoming vehicle scrappage policy is estimated to help take about 90 lakh vehicles off the roads by the next fiscal, and would also help save save around 80 lakh tonnes of oil a year

Road Transport and Highways Minister Mr Nitin Gadkari while speaking on the occasion of the 60th annual convention of the Automotive Component Manufacturers Association of India (ACMA) last week, said that the much-anticipated automobile scrappage policy has reached its final stages of approval, and is expected to be introduced by the end of this month itself.

The vehicle scrapping policy is very important for the revival of the auto industry. I assure you that the scrappage policy is in its last stages of approval and it will come within a month,” the Union Minister said. “We will clear this policy with the approval of the highest authorities and we will definitely going to open up this policy, which can be a win-win for Indian manufacturers,” he also added.

Under the vehicle scrappage policy, old vehicles will be scrapped and in exchange, some incentives will be offered which in turn will be used in recycling clusters, hence, reducing cutting cost of raw materials. The scrappage policy has been a long-standing demand from the Indian automobile industry, especially for aging commercial vehicles plying on the roads.


This policy will not only help remove old polluting vehicles from the Indian roads, but also boost demand for newer vehicles, and hence, help both the automobile sector, as well as the environment. Different scrappage policies have been offered in other developed countries for ages now, and India is expected to join the list soon.

According to a study by HDFC Bank, the market for vehicle scrappage and recycling is estimated at about $6 billion. This also means that around 90 lakh vehicles could go off roads by the next fiscal, and 2.8 crore vehicles by 2025.

According to the bank, a major part of the vehicles scrapped will consist of two-wheelers. This policy would reduce carbon dioxide emission and particulate matter in air by 17% and 24% respectively. In addition, the scrappage policy will help take BSII and BSIII vehicles off the roads, which means it could save about 80 lakh tonnes of oil a year.