Government will soon announce new vehicle scrappage policy, says Gadkari

A scrappage policy is a government-budgeted programme to promote the replacement of old vehicles with new ones.

Published: 12th September 2019 08:27 AM  |   Last Updated: 12th September 2019 08:27 AM   |  A+A-

Union Road Transport Minister Nitin Gadkari and HMSI president, CEO and MD Minoru Kato launch Activa 125 in New Delhi

Union Road Transport Minister Nitin Gadkari and HMSI president, CEO and MD Minoru Kato launch Activa 125 in New Delhi. (Photo| EPS/Parveen Negi)

Express News Service

NEW DELHI: Union Road Transport Minister Nitin Gadkari on Wednesday said the government is at the final stage of working out a much-awaited vehicle scrappage policy and would announce it shortly.
“Scrappage policy draft is being prepared. There are some issues that have to be resolved with state governments and stakeholders. It has to be cleared by the Finance Minister and I am very hopeful that in a short period, we can come out with it,” Gadkari said.

A scrappage policy is a government-budgeted programme to promote the replacement of old vehicles with new ones. It aims to stimulate the automotive industry as well as take obsolete and polluting vehicles off the road. Officials said the policy may encourage people to scrap vehicles older than 15 years by offering them benefits for trading in their old car. Benefits could be in the form of waiving registration fees for the new vehicle or even minor tax concessions. The policy could cover not just four-wheelers, but also two-wheelers and commercial vehicles.

ALSO READ: Finance Ministry in consultation with states on Auto GST, says Nitin Gadkari

Gadkari added that the government was willing to listen if the auto industry wants to suggest an alternative solution or policy that can lift sector. The minister, without making any commitments, referred to the automobile sector’s demand for reduction in GST from 28 per cent to 18 per cent, and stated that the government would do everything to promote the sector as it is one of the largest employment generator.

“Any decision related to GST is taken by GST Council, where the Central and state governments are stakeholders. I am very confident that the Union Finance Minister, in consultation with state finance ministers, if possible, will go for the rate cut. At present, the ball is in the Finance Minister’s court,” Gadkari said amid reports that the GST Fitment Committee is opposing rate cut on automobiles.

The Indian auto sector has been undergoing a prolonged slowdown. Passenger vehicle sales fell nearly 32 per cent in August, the worst decline since 1997-98, while two-wheeler sales dropped by 22 per cent last month.

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