Road Transport Minister Nitin Gadkari likes to think big. At the opening of a vehicle scrapping facility in Haryana earlier this year, just months after the launch of the scrappage policy, he spoke of planning such setups for every district across the country. India, he feels, has the potential to become an automotive scrapping hub of South Asia. Haryana’s new policy is in sync with the Centre’s voluntary vehicle fleet modernisation programme. The aim is to phase out vehicles which have attained the critical age of 10 years in case of diesel models and 15 years in case of petrol. Since the policy rests on incentives and disincentives rather than any compulsion, it might make a limited impact. Letting go of prized possessions is not a trait associated with an average Indian. Also, re-entering the loan cycle for a fresh purchase can be a daunting task for many.
The scrappage policy aims to reduce pollution by phasing out unfit vehicles, boost the demand for more efficient ones and create jobs. The material recycling sector gives direct and indirect employment to four crore people. This number is expected to go up to five crore by 2025. Currently, Rs 22,000 crore worth of scrap steel is imported. The policy, the Centre hopes, could lead to a cut in raw material costs by 40 per cent. Seizing the opportunity, car companies have firmed up plans for a one-stop solution for customers through dealers. On offer will be end-of-life vehicle evaluation, quoting the scrap value, dismantling and issuing certificates to avail government concessions.
The process may take time, but the scrap-recycle facilities are catching the industry’s attention. The technology used could be a gamechanger in deciding the economics of the trade. A bigger challenge is ensuring pan-India uniformity. The policy loses steam if vehicles banned in one state or UT are allowed a free run in others. Whether a vehicle is fit or not depends on how well it is maintained. That makes it essential to build an infrastructure of testing centres with strict parameters. Or else, false certification will become the new mode of corruption.
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