VEHICLE SCRAPPAGE POLICY AND ROAD SAFETY INITIATIVES

1. At a Glance

• Vehicle Scrappage Policy (Voluntary Vehicle-Fleet Modernisation Programme, V-VMP) is a Government of India ecosystem to phase out old, unfit and polluting vehicles via a network of Registered Vehicle Scrapping Facilities (RVSFs) and Automated Testing Stations (ATSs) [S1][S2].
• Administered by the Ministry of Road Transport & Highways (MoRTH); statutory backing flows from the Motor Vehicles Act, 1988 and rules notified in 2021 [S3][S4].
• For UPSC, the topic intersects GS-III (infrastructure, environment, circular economy) and GS-II (Centre–State fiscal transfers via SASCI) [S1].

2. Why in the News

• PIB release dated 04 Feb 2026 reports 129 RVSFs operational across 21 States/UTs and 4,30,306 vehicles scrapped as of 30.01.2026 [S1].
• Department of Expenditure letter dated 22.05.2025 notified SASCI 2025-26 guidelines with ₹2,000 crore earmarked for "Scrapping of Old Vehicles" under Part-VI A on first-come-first-served basis [S1].

3. Background & Evolution

• Union Budget 2021-22: Finance Minister announced a voluntary vehicle scrappage policy; Shri Nitin Gadkari made a Suo Moto statement in Parliament (Mar 2021) detailing the scheme [S5].
• GSR 653(E) dated 23.09.2021 — notification of Motor Vehicles (Registration and Functions of Vehicle Scrapping Facility) Rules, 2021, creating the RVSF licensing regime [S4].
• Policy operationalisation from 01 April 2022; Govt vehicles >15 years mandated for de-registration from 01 April 2023 [S2].
• SASCI capital-incentive window added in 2024-25 and extended in 2025-26 to nudge States to align Motor Vehicle Tax rebates with the policy [S1].

4. Core Static Facts

• Nodal Ministry: Ministry of Road Transport & Highways (MoRTH) [S1].
• Parent Act: Motor Vehicles Act, 1988; Rules: MV (Registration and Functions of Vehicle Scrapping Facility) Rules, 2021 — GSR 653(E), 23.09.2021 [S4].
• Age triggers: Commercial vehicles >15 years, Private vehicles >20 years become liable for fitness retest; failure → mandatory scrapping [S2].
• Twin infrastructure pillars: RVSFs (scrapping) and ATSs (automated fitness testing) [S4].
• Current footprint (30.01.2026): 129 RVSFs across 21 States/UTs; 4,30,306 vehicles scrapped cumulatively [S1].
• SASCI 2025-26 incentive corpus: ₹2,000 crore for scrapping; lump-sum grants ₹10 crore to ₹200 crore per State/UT based on category, linked to notification & implementation of MV tax rebates [S1].
• Policy objectives: reduce vehicular emissions, fulfil India's climate commitments, improve road safety & fuel efficiency, formalise informal scrap sector, secure low-cost raw materials for auto/steel/electronics [S2].

5. Multi-Dimensional Analysis

Economic / Industrial - Builds circular-economy supply chain — recovered steel, aluminium, copper, plastics feed auto and electronics sectors [S2]. - Stimulates fresh vehicle demand (replacement cycle), benefiting OEMs and GST revenues; SASCI grants act as a fiscal federalism tool to reward State compliance [S1].

Environmental - Targets pre-BS-IV/BS-III fleet — disproportionately high contributors to PM2.5 and NOx; aligns with India's Paris/NDC commitments [S2]. - Replaces informal "cut-and-burn" scrap yards with environmentally compliant RVSFs governed under 2021 Rules [S4].

Administrative / Federal - Vehicle taxation is a State subject; Centre uses MV tax rebate (up to 25% PV, 15% CV) and SASCI grants to align State action [S1][S3]. - Uneven rollout — 21 of 36 States/UTs host RVSFs (Jan 2026), exposing geographical concentration risk [S1].

Road Safety Linkage - Removal of mechanically unfit vehicles directly reduces brake/tyre-failure crashes; complements MoRTH's enforcement under amended MV Act provisions on fitness, licensing and overspeeding [S3].

6. Recent Developments (last 12-18 months)

• 22.05.2025 — Department of Expenditure issues SASCI 2025-26 scheme guidelines; Part-VI A extends scrapping incentive [S1].
• 30.01.2026 cumulative data — 129 RVSFs / 21 States-UTs / 4,30,306 vehicles scrapped [S1].
• 04.02.2026 — MoRTH PIB statement to Parliament summarising progress [S1].

7. Prelims Hooks

• Nodal Ministry: Road Transport & Highways (not Heavy Industries, not MoEFCC) [S1].
• RVSF Rules notified vide GSR 653(E), 23 September 2021 [S4].
• Number of RVSFs as on 30.01.2026: 129 across 21 States/UTs [S1].
• Cumulative vehicles scrapped: 4,30,306 [S1].
• SASCI 2025-26 corpus for scrapping: ₹2,000 crore on first-come-first-served basis [S1].
• Per-State lump-sum SASCI grant range: ₹10 crore – ₹200 crore [S1].
• Policy is voluntary, formally titled Voluntary Vehicle-Fleet Modernisation Programme (V-VMP) [S2].
• Age limits — 15 yrs (commercial), 20 yrs (private) for mandatory fitness test [S2].
• Government vehicles older than 15 years de-registered from 01 April 2023 [S2].
• Twin infrastructure: RVSFs + Automated Testing Stations (ATSs) [S4].
• Statutory backbone: Motor Vehicles Act, 1988 [S3].
• SASCI is administered by Department of Expenditure, Ministry of Finance, not MoRTH [S1].

8. Mains Relevance

• GS-III — Infrastructure; Environment & Pollution; Circular Economy.
• GS-II — Centre-State fiscal transfers (SASCI as conditional capex grant); cooperative federalism.
• Probable question stems:
• "Examine how the Vehicle Scrappage Policy addresses the twin objectives of air-quality improvement and circular economy. What bottlenecks persist?"
• "The Special Assistance to States for Capital Investment (SASCI) is emerging as a powerful instrument of conditional fiscal federalism. Discuss with reference to vehicle scrapping incentives."
• "Road safety in India is a multi-stakeholder challenge. Critically evaluate the contribution of fleet modernisation to reducing road fatalities."

9. Related Topics to Study Next

• Motor Vehicles (Amendment) Act, 2019 — penalties, fitness, road-safety board.
• BS-VI emission norms — replacement driver for old fleet.
• FAME-II & PM E-DRIVE — EV adoption complements scrapping.
• SASCI scheme architecture — 50-year interest-free capex loans to States.
• National Road Safety Policy 2010 & Brasilia Declaration commitments.
• Circular Economy Action Plan / EPR rules under MoEFCC.
• PLI Scheme — Auto & Auto Components (linked demand stimulus).
• Air (Prevention and Control of Pollution) Act, 1981 & NCAP — pollution context.

10. Common Errors / Trap Areas

• Confusing the policy as mandatory — it is voluntary (incentive-driven) [S2].
• Attributing RVSF Rules to MoEFCC — they are under MoRTH/MV Act [S4].
• Mixing age limits — 15 yrs is for commercial, not private [S2].
• Assuming SASCI is run by MoRTH — it is a Ministry of Finance, Department of Expenditure scheme [S1].
• Treating ATS = RVSF — ATS does fitness testing; RVSF performs scrapping [S4].

11. Sources

• [S1] VEHICLE SCRAPPAGE POLICY AND ROAD SAFETY INITIATIVES, MoRTH, PIB — https://www.pib.gov.in/PressReleasePage.aspx?PRID=2223331 — (tier 1)
• [S2] MoRTH launches Voluntary Vehicle Modernization Program / Vehicle Scrapping Policy, PIB — https://www.pib.gov.in/PressReleasePage.aspx?PRID=2049367 — (tier 1)
• [S3] Vehicle Scrappage Policy, 2021, PIB — https://www.pib.gov.in/PressReleasePage.aspx?PRID=2042966 — (tier 1)
• [S4] Vehicle Scrappage Policy (RVSF rules / GSR 653(E)), PIB — https://www.pib.gov.in/PressReleasePage.aspx?PRID=2078845 — (tier 1)
• [S5] Shri Nitin Gadkari announces Vehicle Scrapping Policy (Parliament Suo Moto), PIB — https://pib.gov.in/PressReleasePage.aspx?PRID=1705814 — (tier 1)