TERI SCHOOL OF ADVANCED STUDIES CENTRE

FOR POST GRADUATE LEGAL STUDIES

MPL 102: Seminar/Clinic on contemporary issues in

Infrastructure and Environment II.

VEHICLE SCRAPPAGE POLICY 2021

Moderator: Ritvik Mishra

Presenter: Shruti

Discussants: Sakshi kulve

Anu Jindal
Pallavi Srivastava
LAW AND POLICY ON MOTOR VEHICLE SCRAPAGE IN INDIA :- A
SUSTAINABLE PERCEPTIVE
“There is so much pollution in the air now that if weren’t for our
lungs there’d be no place to put it at all”
Robert Orben

INTRODUCTION:
As the passage of time, there are several steps taken by government, tribunals and other
authorised authorities as regard to reduce the vehicle pollution so in the year 2015 THE
NATIONAL GREEN TRIBUNAL made a rule of imposing the ban in the region on all diesel
vehicles which are older than 10 years and on all petrol vehicle which are older than 15years
of age. And Delhi Road Transport office was directed to de-register all 10-year-old diesel
vehicles.1But this matter later on also come under the scrutiny of the judiciary by which in the
case (Mansushi Sangthan, Delhi v. Gov. of Delhi & Ors. On) order was passed to ban on
whether light or heavy vehicles which are more than 10 years old and concerning this order
NGT come in highlight and also imposed a similar prohibition on the registration of those
diesel vehicles which are more than 10 old and for petrol which are 15 years old in the area of
NCR.2 Later on, Tribunals also come into effect and as interim measures made an award to
ban of registration of new Diesel vehicles in NCT Delhi. And it was suggested by the NGT to
central gov. to come up with some law or policy regard to this matter, India in this view is
working on a vehicle scrapping draft policy for the past 4 years and finally Earlier this year,
Finance Minister Nirmala Sitharaman confirmed the arrival of vehicle scrappage policy while
announcing Budget 2021. on 18th march 2021 The Road Transport, Highways and MSMEs
Minister, Nitin Gadkari today unveiled the vehicle scrappage policy in the Lok Sabha.

It is a process of Make a shift from old vehicles to new ones by bringing in Voluntary
Vehicle Scrappage Policy. The idea is to phase out cars and commercial vehicles which are
older than 20 or 15 years, respectively. This is being done in a bid to reduce urban pollution
levels and galvanise automotive sales, which continue to suffer during India’s post-COVID
recovery phase. This means that any private and government vehicle that’s older than 20
years will have to undergo a fitness test. A fitness test, according to the Finance Minister, will

1
Vibhuti Vasisth and Reetika Wadhwa, Ban On Old Vehicles in Delhi NCR -What Does The Future Hold? ; S.S
RANA & Co. on 19 Aug., (2020)
2
Vibhuti Vasisth and Reetika Wadhwa, Ban On Old Vehicles in Delhi NCR -What Does The Future Hold? ; S.S
RANA & Co. on 19 Aug., (2020)
be conducted at automated fitness centres, which will determine whether the vehicle in
question is qualified to run on roads, or headed for the scrap heap.

BENEFITS ARISING OUT OF THIS POLICY

VEHICLE SCRAPAGE POLICY: SUSTAINABLE PERCEPTIVE

“Air pollution is the presence of any solid, liquid, or gaseous substance in the atmosphere in
such concentration as may be or tend to be injurious to human beings or other living creatures
or plants or property or environment” 3Policy expected to be a ‘win-win’ for all as it helps,
reduce environmental pollution, it has been found that alone Vehicular emissions- is
responsible for 41%4 pollution as per the study it has been found that old vehicles are
responsible for producing 10 to 12 % more pollution when these vehicles will be scrapped
out automatically heat on roads, emission due traffics will reduce.

International Perspective

Vehicle scrappage policy had been implemented post 2008 economic slowdown in countries
like- Germany, USA, China, Canada, etc. to boost the economy via reviving sale in the
automobile sector. Germany was able to secure 2 million new car sales out of 2.8 million new
car sales in 2009 and hence it facilitated the shift towards Euro 4 complaint vehicles. It
scrapped cars of 9 years or older by providing an incentive of 2,500 Euros on purchase of a
new Euro 4 complaint cars. US's plan for scrappage policy via 2009 scheme titled 'US' Car
Allowance Rebate System' was moderately successful. It provided for scrappage of vehicles

3
The Air (Prevention and Control of Pollution) Act, 1981
4
Indian Ministry of Earth’s Science on October, 2018
which are less than 25 years old with fuel efficiency of 18 miles/gallon while vehicles to be
purchased were expected to have fuel efficiency of minimum 22 miles/gallon. It led to the
sale of 1.04 crore new cars and light truck sales. Canada's policy reflected more commitment
towards emission reduction than on boosting the economy by focusing more on retiring old
cars than sale of new cars. It introduced a policy in 2009 titled 'Retire your ride policy' which
helped retire 1.2 lakh vehicles which was more than the initial target of 50,000 vehicles. It
targeted vehicles manufactured unto 1995 which constituted 27% of the total vehicles on the
road and 2/3rd of the vehicular pollution. The scheme owed its success to the additional
incentive provided by automakers and other rewards provided by different provinces.
Criticism of such policies include that they are not as effective in targeting carbon emissions
as while plying on the road the emission level from vehicles could still be the same. A better
alternative would have been shift to electric vehicles which lead to 100% emission reduction
of NOX, CO2, etc. It had been the case in Germany where the vehicle scrappage policy was
successful in providing economic boost to automobile sector but it did not fare so well in the
emission reduction front.

ISSUES:

 What is the background of Vehicle Scrap Policy?

 How Vehicle Scrap policy is beneficial and its sustainability affecting India?
 What is the Vehicle Scrappage Policies in other countries?

Reference:

1) Vehicle scrappage policy: Global perspective, Indian opportunity,

http://content.icicidirect.com/mailimages/Vehicle-ScrappagePolicy-2020.htm

2) Premiums for new car sales as a response to COVID-19 - The case of Germany,
https://theicct.org/blog/staff/premiums-new-car-sales-response-covid-19-case-
germany .

3) Opinion: Environmental benefits of scrappage policy - Age as the sole criterion meets
the requirement
https://auto.economictimes.indiatimes.com/news/industry/environmental-benefits-of-
scrappage-policy-age-as-the-sole-criterion-meets-the-requirement/74060964