Vehicle Scrapping Policy

 

 

During her budget speech, Smt Sitharamaji  announced that detailed policy will be released by the Transport Ministry, in 2 weeks

Pending that release, news-papers are full of articles on this, raising many questions. Here are some :

Auto sector cheers scrappage policy / Business Line / 02 Feb

Auto scrappage policy ; Devil could be in the details   /  Business Line  /  02 Feb

Centre launches voluntary vehicle scrappage policy  /  HT  /  02 Feb

Incentives should have been offered with policy on scrapping old vehicles / Times City /02 Feb

New policy makes it costly to keep old cars / Times of India / 03 Feb

Green Tax may drive up CNG vehicle sales  /  HT  /  01 Feb

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First tentative announcement of this policy was made nearly 4 YEARS ago !

Since then, a couple of “ Drafts / Revised Drafts “ have  been circulated inviting feedback / comments from,

Ø  General Public ( Buyers / Users of vehicles )

Ø  Auto Manufacturers / Auto-Component Manufacturers

Ø  Auto Dealers

Ø  Vehicle Scrap Dealers

Ø  Professional Associations

Ø  Trade Bodies ( SIAM – ACMA – SAVE etc )

Ø  Public Transport Authorities / RTOs

Ø  Edu Institutions offering courses in TRANSPORT – TRAFFIC management …etc

With so much debate – and over such a long time -, one would expect that, when released, the policy would answer the following questions (  FAQ  ), sharply / unambiguously :

[ 1 ]

Since “ scrapping “ ( or not ) is voluntary, can I keep “ owning “ my 21 year old car  ? Not a crime ?

[ 2 ]

Can I “ Sell “ it ( to a willing buyer ) or “ Gift “ It ?

[ 3 ]

If it is already “deregistered“ by RTO, do I still have to pay Road-Tax / Green Tax as Owner ?

[ 4 ]

I understand it will get impounded if I drive it on roads but can I keep it parked in my garage ?

[ 5 ]

If traffic police impounds it ( while on road ), will I get any punishment / compensation ?

[ 6 ]

What will happen if I do not take my OLD car for periodic “ re-registration / fitness certificate “ ?

[ 7 ]

What happens if a NEW ( 3 year old ) car fails “ fitness test “ ? Will it get impounded ?

[ 8 ]

What if a 21 year OLD car “passes“ the “ fitness test “ ? Can it continue to run it ?

[ 9 ]

Nearest automated “ fitness testing centre “ is 200 km away ( only 7 out of 25 sanctioned are operational )

Will my old car get impounded while taking it to such centre ?

[ 10 ]

There are only 2 “ authorized scrapping centres “ ( including 1 in Noida ). Where do take my old car ?

[ 11 ]

Are these “authorized scrapping centres“ mandated to pay certain amounts to person surrendering old vehicles ?

There are thousands of combinations of “ Types and Ages of Vehicles “ . Will Govt fix “ scrap prices “ for each combination ?

[ 12 ]

What will Govt ( traffic police / dept ) do with the “ impounded “ vehicles ?  Sell to “ authorized  scrapping centres ?

Will the amount realized get reimbursed to the vehicle’s original owner ? 

Does ownership of an impounded vehicle, pass automatically to the TRAFFIC DEPT or vest with original owner ?

    

[ 13 ]

Will there be any INCENTIVE , either for the OLD car owner or for the NEW car dealer ( or both ) ?

[ 14 ]

Who will bear the cost of such an incentive ( and get reimbursed by the State Govt / central Govt ) ?

[ 15 ]

If govt does not have money for paying INCENTIVE, will it consider motivating old-car owners by crediting into their JAN DHAN Accounts certain number of CARBON CREDITS ( like crypto-currency ? ) and launch VEHICLE CARBON CREDIT TRADING EXCHANGE ?

   

The number of Carbon Credit will depend upon Age/type of OLD car and those of REPLACEMENT car

[ 16 ]

According to news reports, the number of vehicles that will come under the purview are :

Ø  LMV  [ Light Motor Vehicles ] which are older than 20 years :

    51 lakh  ( 5.1 million )

 

Ø  LMV which are above 15 years ( but less than 20 years ) :

    34 lakh  ( 3.4 million )

Ø  Medium/Heavy vehicles which are more than 15 years old

    17 lakh  ( 1.7 million )  [ These  MHV do NOT have fitness certificates ]

How many vehicles can be tested in ONE DAY ( and issued fitness – or failure – certificate ) by ONE testing centre ?  Let us assume 100 / day ( 30,000  / year in 300 working days )

    Hence, to test all 102 lakh vehicles in ONE YEAR , we need 340 Fitness

    Testing Centres !

If we are to depend upon existing 25 centres only, it will take 14 YEARS !

[ 17 ]

I believe, in India, our current Vehicle population is approx. 24 crore ( 2400 lakh ) This population is growing by about 30 lakh vehicles EACH YEAR

       

I assume that, out of this some 200 lakh vehicles will become OLD, each year.

These too will need scrapping EACH YEAR ! 

 

Hence, from 2022, we need to replace 302 lakh ( 102 lakh +  200 lakh )  vehicles EACH YEAR !

      

Do we have the necessary RESOURCES to test these / scrap these / replace these with new ones ?

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By no means, the above is a comprehensive list of questions. Expect many more in coming days

Those looking for some suggestions ( possible answers ), may want to look up my following 18 E-Mails to our Policy Makers  :

 

2016   ( 3 )

PIYUSH PLAN ?                                         [ 27 Mar 2016 ]

Young or Old ?.........................................[ 27 Aug 2016 ]

From OLD to NEW ? No , go NEWER ! …………[ 22 sept 2016 ]

2018   ( 8 )

Car Grave-Yard of World ?  …………………………..[ 14 Feb 2018 ]

One door closes ; Another opens …………………. [ 27 Feb 2018 ]

Mahindra Accelo : Saluting a pioneer …………….[ 19 June 2018 ]

Scrapping Old Vehicles : Swiss Challenge Solution [ 24 July 2018 ]

Rename it , “ Vehicle Recycle Policy “ …………….[ 08 Aug 2018 ]

Transport Solutions ? Must try everything ………[ 25 Oct 2018 ]

Better Late than Never ! …………………………………..[ 01 Nov 2018 ]

Missing piece of Jigsaw Puzzle ? ……………………….[ 15 Nov 2018 ]

2019   (  2  )

FAME II > FAME III > FAME IV  ………………………..[  05 Mar 2019 ]

Congratulations, Shri Saurabh Kumarji……………..[ 13 Nov 2019  ]

2020  ( 3  )

I conceive , I conceive , I conceive !  ………………..[ 25 Feb 2020 ]

Dead on Arrival ?  ………………………………………………..[ 19 July 2020 ]

Alang : Junkyard ? Scrapyard ? SaveYard ?......... [ 12 Dec 2020 ]

2021  (  2  )

Gadkariji : Green Tax is Good  ………………………………[  26 Jan 2021 ]

A Brief History of Electric Vehicles in India ……………[ 30 Jan 2021 ]

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Dear Shri Gadkariji,

What can go wrong, WILL go wrong 

Nor is it possible to anticipate all the problems in advance and have answers “ready” for each and every situation ( - especially in an issue as complex as VEHICLE SCRAPPING POLICY )

I urge you to expedite the announcement – then make course-corrections as we go along

With regards,

Hemen Parekh / hcp@RecruitGuru.com / 04 Feb 2021