India's vehicle scrappage policy is in the final stages of clearance

India has long awaited a formal vehicle scrappage policy and from the looks of it, it won't be long before it is formally introduced in the country. If you are having a little bit of a déjà vu moment, or something similar with a very specific word in German for it, it's because the government has been assuring that the policy will be introduced 'soon' for quite some time now. But hey, we have got to tell you the latest -- it's our job. In fact, it was finally supposed to have been announced during the Budget 2020 announcements, but that didn't happen. Not sure if that was surprising or unsurprsing, because, you know.

The proposal for a formal policy for scrapping old vehicles first emerged in July last year, when the government suggested revisions to the Motor Vehicle Act so as to provide for scrapping vehicles older than 15 years. This proposal, in turn, was driven by the efforts to deal with a few challenges in the automotive industry, including increasing pollution abd encouraging the adoption of electric vehicles. In the same vein, the government, via a draft notification, had also put forth the proposal to revise the policy for renewal of fitness certificates for vehicles older than 15 years. It suggested that instead of necessitating renewal once a year, it should be renewed every six months for vehicles that are older than the prescribed limits.

Anyway, ET reports that Nitin Gadkari, Union Minister for Road Transport and Highways, said the vehicle scrappage policy has been given the clearance on his end. Now all that remains is the cabinet's clearance before it can be formalised. While that may not seem very reassuring, Gadkari added that it could be done as soon as within 15 days.

The policy is widely deemed to be critical for both the industry and the country owing to the handful of issues with which it is expected to lend a helping hand. But another reason why it is so eagerly awaited is because it will provide some respite to the automotive industry, which has struggled with a drastic decline in sales since 2019.