Government Announces the Launch of New Scrappage Policy
The Revised Rules-
According to the new policy, the commercial vehicles are being allotted 15 years to get a fitness certificate while private vehicles are being allotted with 20 years for the same. If the vehicles fail to get a certificate of fitness from the established Fitness Centres within the prescribed time frame, they will be sent for scrapping.
What’s in for the owners?
This policy has a few ups for the vehicle owners, as the ones opting for scrapping will be given a scrap value of about 4-6% on the ex-showroom price of a new vehicle. Furthermore, on purchase of a new vehicle, they will also be granted a 5% discount from the manufacturers. There are also other additional benefits in it; such as getting upto 25% exemption on road tax from states, along with registration fee waiver.
Environment Friendly Growth- Circular Economy
The new scrappage policy aims to work its way on a circular economy. A circular economy is one where the economy makes sure to re-employ all its resources to their extent by using methods such as recycle, reuse, recover, refurbishment and repair. Based on the 3 R rule of reuse, recycle and recover, the policy promises a lot more than just economical growth to the society. It promises economic development.
Upside For The Economy-
The policy has the capacity to draw in investment as high as Rs. 10 thousand crores in addition to creating opportunities for mass employment, said the Prime Minister. The Prime Minister also mentioned that previously renowned for its ship recycling, Gujrat has the necessary means along with the available infrastructure and manpower to become a new vehicle scrappage hub.
The Required Setup
As just the structure has been laid, the implementation being the main challenge ahead. A lot of work is left to be done before the new policy can be brought into effect in the economy. It is tentatively expected to be passed around 2023 for commercial vehicles.
The main required infrastructure for the laid-out plan would be the Automated Fitness centres where the vehicles will be checked for fitness. This will involve checking for the engine, brakes and other crucial parts of the vehicles. The states have been requested and are expected to give the land for Fitness Centres to be built upon.