The Central Government has recently notified draft rules of many aspects relating to the ‘Vehicle Scrapping Policy’. This article looks at the major features of the policy, the uncertainties surrounding it among other things. Recently, the Ministry of Road Transport and Highways (MoRTH) introduced the ‘Voluntary Vehicle-Fleet Modernization Program’ or ‘Vehicle Scrapping Policy’ with the objective to create an eco-system for phasing out unfit and polluting vehicles. Through this policy, the government aims to cut down on the pollution caused by old and defective vehicles, bring down vehicular air pollution and work towards achieving India’s climate commitments, improve road and vehicular safety, and improve fuel efficiency. The draft policy which has been drafted after a comparative study of standards from various countries like Germany, the UK, USA, and Japan, has been notified in the public domain for comments and views for 30 days. Old vehicles cause 10-12 times more pollution that the new ones According to the estimates of MoRTH, there are over 51 lakh light motor vehicles (LMV) that are above 20 years of age, while another 34 lakh LMVs are above 15 years. Additionally, there are over 17 lakh medium and heavy motor vehicles, which are above 15 years, and running currently without valid fitness certificates. These vehicles are estimated to cause 10-12 times more pollution than the latest vehicles, according to MoRTH. Government owned vehicles above 15 years old will be scrapped The draft policy calls for the de-registration of commercial vehicles after 15 years if they do not get the fitness certificate. Similarly, private vehicles will be de-registered after 20 years upon failing to renew the registration certificate. In the case of government owned vehicles including PSUs, State Transport Undertakings, and autonomous bodies, all vehicles may be de-registered and scrapped after 15 years from the date of original registration. A vehicle failing the fitness test or failing to renew the registration certificate may be declared as ‘End of Life Vehicle’. The scrapping policy is not applicable to vintage cars. Incentives and disincentives announced to promote scrapping of old vehicles The government aims to check the number of old vehicles on roads through incentives and disincentives. It has proposed increased prices for new fitness tests, issuance of fitness certificates, and re-registrations to dissuade the usage of old vehicles. Even the cost of re-registering an old vehicle is proposed to be increased. As per a draft notification issued recently, the cost of registration & renewal of registration of all vehicles has been proposed to be hiked by up to 20 times, based on the type of vehicle, with effect from October 2021. Even the cost of conducting the fitness test of vehicles has been proposed to be increased from 2.5 to 4 times for manual and even more for automated vehicles. An additional cost for granting fitness certificates to vehicles older than 15 years has been proposed, ranging from Rs. 1000 for motorcycles to Rs.12,500 for heavy passenger/motor vehicles. Cost of re-registration, fitness certificate issuance and test hiked manifold For instance, the cost of re-registering a light motor vehicle (non-transport) currently is Rs. 200. In order to conduct the fitness test for renewal of the fitness certificate, the owner will have to pay Rs. 200 and for issuance of the fitness certificate, they will have to pay Rs. 100, and the expenses will come to a total of Rs. 500 approximately. If the proposed draft rules are implemented, the re-registration cost will be Rs. 5,000. To conduct the fitness test, it will cost between Rs.800 to Rs.1000. If the vehicle is older than 15 years & is a transport vehicle, the owner will have to pay Rs. 7,500 for issuance of fitness certificate. The total expense for the owner can go up to Rs. 13,500 if the draft rules are implemented without considering the additional charges which are applicable for delay in renewing these certificates after the expiry date. Incentives like Road-tax rebate, waiver in registration fees to be offered The incentives to be offered to vehicle owners for scrapping their old vehicles and procure new vehicles are the following. The policy implementation is to be done in a phased manner starting with the implementation of new rules from October 2021, scrapping of government vehicles from April 2022, and mandatory fitness tests from April 2023. Draft rules for setting up of RVSF has also been notified The Ministry has also notified draft rules for setting up Registered Vehicle Scrapping Facility (RVSF) and prescribes procedures for its authorization and functioning.