A vehicle scrappage policy is programme that helps replacement of old vehicles with new
ones. It encourages vehicle owners to scrap vehicles older than 15 years and purchase new
ones instead. In order to facilitate this, the government offers financial or tax-based benefits
to consumers on purchase of new vehicles. As part of the upcoming scrappage policy, the
Indian government is contemplating waiving off the one time registration fee on purchase of
a new vehicle after scrapping an old one.
India’s scrappage policy
The Minister for Road Transport and Highways has approved the policy of deregistration and
scrapping of vehicles owned by the government departments and public sector units (PSUs).
The new vehicle scrappage policy will come into effect from April 1, 2022. Under the new
scrappage policy, government and PSU owned vehicles that are more than 15 years old will
be deregistered and scrapped. Besides, registration fees will not be charged on vehicles
purchased to replace old vehicles of the same category. The two things to concentrate in this