Government Plans To Expunge 15-Year-Old Vehicles

Addressing the pollution problem has been one of the most discussed topics in the recent past. First it was the diesel ban in Delhi, followed by two rounds of the odd-even rule in the same region. Whilst Delhi was fighting the ban, government body NGT (National Green Tribunal) and the Supreme Court of India passed order that brought affected automotive manufacturers to appeal for a compromised solution.

A few days ago, the Supreme Court lifted the diesel ban from the National Capital and the adjoining areas. The court specified that only those manufacturers who are ready to pay environmental cess (1 per cent) on every diesel-powered vehicle they sell (with engine capacity equal to or greater than 2000cc), will be registered in the region. Additionally, government bodies said that vehicles from the pre-Bharat Stage era should be taken off the road. This was tagged as a voluntary move rather than a mandatory one for vehicle owners.

Now, the government is contemplating to introduce a policy to expunge vehicles that are over 15 years old. This will be applicable for trucks, buses, lightweight commercial vehicles and personal four-wheelers. On August 24, 2016, Finance Minister Arun Jaitley and Transport Minister Nitin Gadkari met  to discuss that people need to be encouraged to scrap their 15-year-old vehicles and opt for newer ones.

Reportedly in the first phase, 11.5 lakh trucks and buses will be taken off the road. In the second phase, the same will be implemented for lighter commercial vehicles and personal four-wheelers which collectively account for 60 lakh vehicles. "The finance minister felt scrapping of pre-Bharat Stage vehicles should be mandatory instead of voluntary . The finance ministry is not in favour of reducing excise duty as incentive but they could make a Budget provision for direct cash incentive," Gadkari said.

The transport ministry discussed and pointed out how the overall revenue collection in the form of excise tax would be approximately Rs 18,000-19,000 crore, courtesy the sale of new vehicles. This, they reportedly said, would be much more than the government would otherwise provide as cash incentive. Additionally, replacing the old vehicles will help save Rs 7,700 crore annually, as new, more fuel-efficient vehicles will take their place and hence reduce the amount of crude oil imports.

A larger committee will be set-up to create a detailed plan for this scheme. The government wants to start with trucks and buses as they account for a much smaller lot as compared to lightweight vehicles.