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

===================================================

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 ?

===============================================

 

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 ]

===================================================

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

 

 

2021-22 Budget Blues : Digital Census

 

 

Context :

Union Budget 2021: FM Confirms 2021 Census Will be First Digital Census in India 

  

Extract :

Ø  he 2021 national census of India will be held digitally, confirmed Finance Minister Nirmala Sitharaman during her Union Budget 2021 speech. Touching upon the topic, Sitharaman confirmed that the upcoming census of India would become the very first one in the history of India to be held digitally, marking India’s transit towards digitising government and public services, and continue transiting towards paperless operation systems. The FM’s statement falls in line with a previous statement given by Union Home Minister Amit Shah in 2019.

Ø  Back in 2019, Shah had stated that the 2021 national census would be held fully digitally, and had further highlighted that the government is set to spend up to Rs 12,000 crore in setting up the digital framework for the census. He had also confirmed that a mobile app will be used in the process of census 2021. While the exact specifics have not been issued yet, the previous reports have highlighted that those certified to carry out the census process may be encouraged to used their own mobile phones for the process. It will also be interesting to note the infrastructure that the central government sets up in a bid to maintain the sanctity of collected data.

Ø  The 2021 census of India is set to begin in March 2021, after the previous census was undertaken in 2011 – marking India’s population at 1.21 billion back then.

===================================================

This is indeed a GOOD beginning .

10 years back, census required 30 million enumerators to manually enter citizen data in 1.21 billion PAPER FORMS

And possibly required, thousands of DATA ENTRY operators, many months to enter these data into Servers

May be in 2021, are we ready to capture all data DIRECTLY into a Mobile App ?

 

I suggest following process :

Ø  Once data of all ( 1400 million ? ) citizen gets uploaded onto the Server, downloading / installing of Mobile App will be made mandatory for all citizen ( by that time, I expect everyone to have a Smart phone – which, itself would be a DATA FIELD – with Mobile Number and E Mail ID – as optional  )

Ø  After data of all citizen is uploaded, every day, server will push onto the mobile screens of 5 MILLION citizen, the CENSUS FORM , which is fully pre-filled with his / her data captured during 2021 Census ( as being planned with income-details for online IT Returns )

Ø  Citizen will UPDATE the changed / missing / new data and click EDITED , for auto over-write in Server

Ø  If he fails to click EDITED for 24 hours, EDIT-FORM will self-destruct and old data will continue

Ø  Every citizen will get this opportunity for SELF-UPDATING, once every year ! ( 5 million / day x 300 days )

of course, if so desired, this pre-filled form can be pushed ( to citizen's mobile ), once every 4 months

Or, System would grant access to each citizen to login ( portal ) and EDIT data anytime / as often as he wants 

No need for NPR  or  NRC  ! No duplication of same data, again and again 

No opposition from any section of the Society !

Ø  For new-born to “ join “ and dead persons to “ exit “, following technology to be employed :

BMW, Ford back development of vehicle 'birth certificates' built on the blockchain  

Ø  For details of suggested MOBILE APP and INCENTIVES for CITIZEN ( for self-census ) , read :

             Census 2021 : an Unprecedented Opportunity   /   11  April 2019

 

             Confused about CENSUS - NPR - NRC ?            /   24 Dec 2019

 

             A Case of Mistaken Identity ?                           /  28 Dec 2019

 

              Unprecedented Opportunity Seized !                  /   18 Jan 2020

 

             One Stop Shops ?                                             /   24 Jan 020

 

CC :

Shri Rajiv Gauba – Home Secretary  [  hshso@nic.in  /  r.gauba@nic.in ]

Shri Vivek Joshi – Registrar General of India ( RGI ) [  rgi.rgi@nic.in  ]

===================================================

With regards,

Hemen Parekh  /  hcp@RecruitGuru.com  /  03 Feb 2021

 

 

 

 

 

 

21-22 Budget Blues : One Person Company ( OPC )

 

Context :

FM’s one-person co vaccine leaves startups in two minds   [  TOI / 02 Feb  ]

Extract :

The proposal to incentivise setting up a One Person Company ( OPC ), might not led to any significant boost for startups, though it may help micro-entrepreneurs formalize their business at a very early stage

While allowing OPCs to grow without any restrictions on paid-up capital and turnover, allowing their conversion on any other type of company at any time, FM reduced the residency limit for an Indian citizen to set up an OPC to 120 days from 182 days and allowed NRIs to set up OPCs in India

“ The ability of OPCs to raise external capital, be it angel funding or any other, is severely limited. OPCs can’t even issue staff shares. This announcement is good for people who are running mom-and-pop shops, since they can now have a corporate structure and avail of lower tax rate “, said Siddharth Pai, founding partner at venture capital firm, 3one4Capital

[ siddarth@3one4capital.com  ]

Nithin Kamath, co-founder and CEO of Zerodha,

[ nithin.kamath@zerodha.com ]

 - echoed Pai, saying, “ I don’t think it will make any material impact on the Startup Eco-system like Bengaluru’s. May be it will help micro or small-sized entrepreneurs like someone setting up a bakery “

But Ankur Bansal, co-founder of BlackSoil,

[ ankurbansal@blacksoil.co.in ]

- a venture debt platform, said the biggest advantage of an OPC is that its identity is distinct from that of its owner

===================================================

Thank You, Smt Sitharamanji,

 

Without doubt, the relaxations announced by you will go some way to make it easy for entrepreneurs to become “ Self Employed “ . For that reason, this is a very welcome announcement

But when released, if the “ details “ were to incorporate suggestions contained in my following e-mail, then we will see 4 / 5 million OPCs registering within next 12 months !

With changes suggested by me, Shri Tomar would be able to convince 140 million FARMERS, to register themselves as One Person Companies ( OPCs ) and start entering into contracts with other FARMERS’COOPERATIVES / Companies / Food Corporation of India etc., under CONTRACT FARMING ACT  ! In any case , currently farmers are not liable to pay any Personal Income Tax !

Within 24 hours , farmers will withdraw their agitation demanding repeal of Farm Laws !

A NEW ECONOMIC ORDER ? aka " Start Up Act - 2015 "…….. 12 Sept 2015 

Extract :

 

#   Objectives of the Act

 

     Every year , to create 5 million Start Ups , each employing 2 persons , for a

     total of 10 million new jobs per year

 

     

 

 

#   Methodology

 

     *  Instead of Companies Act - 1956 , these Start Ups will be governed by

         the Start Up Act - 2015

 

     *  A Start Up can be launched by any Indian citizen under the age of 30 (

         covering roughly 65 % of our  population )

 

          

     *  A Start Up will need to register online on the web site of the Income Tax

         Department and obtain a unique " Start Up Number "

         

 

     *  Although all Start Ups will need to file annual Income Tax returns ( with

         full disclosure of income /expenses / profits / sources of funds etc ) ,

         it will not be required to pay any Corporate Income Tax for

         the first 10 years of its existence

 

     *  A Start Up will be free to raise  funds from any source ( Individuals /

         Companies / PE funds / VCs / Angel Investors / Religious Trusts etc )

         

     *  100 % FDI will be permitted in Start Ups

 

     *   A Start Up can receive loans or equity and be able to accept fixed

         deposits . It can also give loans to individuals or other Start Ups or inves

         in other Start Ups by way of equity

         

 

    *  There will be no restrictions on what interest ( on loans / FDs ) that a

        Start Up may pay nor any restrictions on dividends it may declare

 

        

        The dividends declared by Start Ups will not attract any Income Tax

 

    *   As far as the persons / companies etc providing funds to Start Ups ( by

         way of loans or equity ) is  concerned , no questions will be asked re

         their source of funds

 

         

 

 

#   What  will  happen  ?

 

   *   Billions of rupees worth Black Money will flow into these Start Ups -

        money which is currently lying unutilized or locked up in unproductive

        assets

 

        

 

    *   If Jan Dhan Yojana could create 200 million bank accounts in 20

         months, Start Up Act - 2015 , will  create 200 million Start Ups in next

         10 months !

 

         

         All that led to this World record was, someone suggesting the

         unthinkable :

 

        " Let us enable poor people to open bank accounts with ZERO bank

           balance "

 

        " Start Up Act- 2015 ", will unleash a similar " Start Up Tsunami "  !

 

 

    *   Within 3 months , thousands of Venture Capital Funds will be born,

         exclusively for funding of Start Ups (You know who will set up these VCs 

         

    *    With NO Income Tax to be paid, Start Ups will conduct all transactions              through cheques ( receipts / payments )

 

         

 

    *    GST  collections will go up

 

    *    Domestic Savings Rate will go up

 

    *    Since millions of ( Black Money holding ) individuals / businesses will

          come forward to fund these Start Ups, lending pressure on banks will go

          down 

 

          

    *    Who knows, Start Ups may get into the business of Assets

          Reconstruction and relieve banks of NPAs !

 

    *    With locally / domestically stashed Black Money flowing into the

          economy, our dependence on FDI will  go down

 

           

    *    Corruption will decline drastically

 

 

 

#   Why  the  need  for  Start Up Act  ?

 

·          It is simple

 

            In the past 300 years , we have had different systems of Economic

            Development , viz:

 

            Communist  /  Socialist  /  Capitalist

 

·        There were periods when each worked well - depending upon the

         geography and the technological environment prevailing during those

         periods

 

·          Today, Internet and mobile apps are pushing the World towards an

           E - Commerce economy , which covers entire World seamlessly

 

·          Tomorrow, Internet of Things ( IoT ) , will tell us what we need to do

           and when ! Our lives will be dictated by devices !

 

              That will demand a brand NEW SYSTEM of economic development

              which transcends national boundaries

 

            

 

·          Old rules / regulations / laws will not help us find jobs for 12         million youths entering India's work force each year

 

·          An ocean-going " Ship " , cannot traverse galactic distances of Space

 

·          Following in the footsteps of Albert Einstein / Stephen Hawking , we

           need to

 

            " Bend the Space "

 

              And travel through the Worm-holes !

 

·          Using the hologram of the " Start Up Act - 2015 " , we must projec

           our economy into :

 

           "  Distributist Economy ",

 

-  which goes beyond the " Communist / Socialist / Capitalist " economies 

 

·          That is the ONLY WAY to create a ,

 

            "  New  Economic  Order  / The Start Up Economic Order "

===================================================

With regards,

Hemen Parekh  /  hcp@RecruitGuru.com  /  02 Feb 2021