Budget 2021: FM proposes voluntary vehicle scrappage policy to phase out old automobiles

At the Union Budget 2021 today, the FM said details of a scrappage policy would be announced separately.

The policy will urge vehicle owners to scrap their old vehicles

Cars older than 20 years and commercial vehicles older than 15 years will be eligible for retirement.

The policy claims to bring ₹43,000 cr business opportunity by boosting consumption in the industry.

The government will offer

Financial or tax-based benefits to consumers who choose to scrap their old vehicle and purchase new vehicles.

Move to boost auto demand

When implemented, the policy is expected to increase production and capacity utilisation of vehicles

This was among one of the top demands of the auto industry ahead of the Budget.

Union minister Nitin Gadkari earlier said…

A vehicle scrappage policy will give a major push to the country's automobile manufacturing industry

It would be a good way to avoid any financial burden on the government as well as reduce emissions.

Investor cheer: BSE Auto Index jumped nearly 200 points right after the announcement

M&M, Maruti and Escorts were the top gainers — with stocks soaring nearly 2 percent.

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