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PM Launched National Automobile Scrappage Policy in Investor Summit 2021 in Gujarat

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In August 2021, Prime Minister Narendra Modi virtually addressed the Investor Summit 2021 in Gujarat and launched the National Automobile Scrappage Policy to discard/Scrap the old inefficient and polluting vehicles in an environment-friendly manner.

  • Objective: To scrap unfit vehicles and create a feasible circular economy and bring value for all stakeholders while being environmentally responsible.
  • Background: In the Union Budget 2021, the Vehicle Scrapping policy was announced to phase out old and unfit vehicles with effect from April 1, 2022.

a.Key Features of the Policy:


  • The policy will generate investment of more than Rs 10000 crores to set up 450-500 Automated Testing Units (ATU) and 60-70 Registered Vehicle Scrapping Facilities (RVSF) /scrapping centres across India.
  • The policy would support the modernization of the vehicular population of India by scrapping and also improve economic development.
  • Automobile sales will increase following the new policy, which will add 30 to 40 thousand crore rupees in GST collections of Centre and States.


  • Under the policy, a certificate will be provided on scrapping the old vehicle and those who are having that certificate will not need to pay money for registration on the purchase of a new vehicle.
  • Scrapping old vehicles will reduce the harmful impact of pollution on people’s health and also reduce the risk of road accidents.

iii.Scrapping Process: After completion of the limits of 15 years (for government vehicle)/ 20 years (for personal vehicle), the vehicles will undertake scientific automated fitness tests (not only on the basis of age of vehicle) through authorized, automated testing centres.

  • A vehicle will be declared as End-of-Life or unfit if it fails the fitness test, after which, the unfit vehicles will be scrapped scientifically.

iv.Employment Generation: This policy will provide employment to thousands of scrap related sector employees and small entrepreneurs. They will also get a safe environment and benefits like other organized sector employees.

b.The Investor summit in Gujarat:

i.The summit was arranged to invite investment for setting up vehicle scrapping infrastructure under the Voluntary Vehicle-Fleet Modernization Program or the Vehicle Scrapping Policy.

ii.The summit also focuses on the synergies presented by the ship-breaking industry at Alang, Gujarat, Asia’s largest ship recycling and scrapping yard, for the development of an integrated scrapping hub.

Participants: Union Minister for Road Transport & Highways, Nitin Gadkari and Chief Minister of Gujarat, Vijay Rupani also participated in the event.

-Tata Motors Signed MoU with Gujarat Govt to Set Scrapping Centre in Ahmedabad

i.Tata Motors signed a memorandum of understanding (MoU) with the Gujarat state government through the ports and transport department to support the setting up of a vehicle scrapping facility in Ahmedabad, Gujarat.

ii.Capacity: The scrapping centres that will be set by Tata motors will have a capacity of recycling up to 36,000 vehicles (both passenger and commercial) a year. It will set the scrappage centre in association with a partner.

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About Gujarat:

Chief Minister – Vijay Rupani
WildLife Sanctuary – Girnar Wildlife Sanctuary, Wild Ass Sanctuary, Jessore Sloth Bear Sanctuary.
Zoological park – Sakkarbaug zoo, Dr. Shyamaprasad Mukherjee Zoological Garden (Sarthana Nature Park), Kamla Nehru Zoological Garden.