Scrappage Policy in India: Will It Boost EV Adoption?

Sibi Krishnan
4 min readApr 10, 2023


The Voluntary Vehicle Fleet Modernisation Programme, often known as the vehicle scrappage program, was launched on August 13 by Prime Minister Narendra Modi.

The Vehicle Scrappage Policy’s Highlights

Since the second part of 2019, the Indian car industry has been in turmoil. The subsequent COVID-19 epidemic exacerbated the issue. Although post-Diwali sales in 2020 have helped to improve the industry, the situation remains worrying. The scrappage program is claimed to benefit India’s ailing automotive industry. There will be a need for new automobiles when existing vehicles are phased out. Scrapping inoperable automobiles is also good for the environment.

Here’s a rundown of the most important points from the Vehicle Scrappage Policy release.

  • The initiative aims to create a mechanism in India for scrapping unsuitable cars.
  • The actual scrapping procedure will be governed by rules and regulations, which will be outlined in the MoRTH’s statement.
  • For scrapping outdated automobiles, vehicle owners would receive various perks.
  • Scrapping unsuitable cars will contribute to a significant reduction in air pollution (subjective as per location).
  • People will be eager to purchase automobiles that are environmentally friendly, safe, and has sophisticated technologically.

What Makes It Special?

The program, which has been in the works since 2015, aims to incentivize owners of outdated, polluting automobiles to scrap them and get them off the road. Vehicles that are over 15 years old in commercial use and over 20 years old in personal use will be eligible for scrapping.

According to the Prime Minister, the car scrappage program will bring in approximately Rs 10,000 crore in investments. He also suggested that Alang, Gujarat, might become a car scrapping center.

There are a number of benefits of this program. Of course, there would be some people against this but not considering that. This is a daring step taken by the Union Government.

The general benefits are,

  • Boost the automobile sector.
  • Cleaner, safer and economical vehicles on the road.
  • Reduction in the air as well as the sound pollution.
  • Creates numerous job opportunities both in the scrapping sector and production sector.
  • Overall boost to the economy itself.

We can list the benefits the scrappage policy brings but let us look into the benefits Evs get out of it.

Scrappage Policy and EV Sector

The question is, will the scrappage policy helps to strengthen the EV sector?

The answer is a bit complex and there is no definite answer to the question.

Upon a closer look, the scrappage policy will aid the faster adoption of EVs in India because Indians had a shift in their perception of Evs. The numerous successful EV startups are classic examples of this improved outlook of the Evs.

People in urban areas are leaning towards the adoption of the Evs for a number of reasons such as,

  • They are the direct beneficiaries of the improvement from pollution.
  • Current EV models in the market are enough for their requirements.
  • Evs are best suited for most of their requirements and more convenient.

But we cannot eliminate the fact that ICE vehicles have a strong base because it is time tested and tuned to perfection over the years.

Competing With the ICE Vehicles

Currently, two-wheelers and three Wheeler lead the EV sector in the Indian automobile environment. There are a number of reasons for this starting from the range anxiety, high upfront cost, and availability of the charging stations. But most importantly many people in India are still a bit skeptical about EVs.

Bridging this gap is very important and the union government and local bodies have to vigorously work towards it and fortunately, they are on the right path.

Union Government is treating EV adoption as a top priority and has offered several appealing tax reductions and other incentives. These incentives and other benefits will decrease the cost of ownership of an EV and at the same time as the pollution and safety standards in the country raise the cost of ownership of an ICE vehicle goes up. This will definitely aid the faster adoption of EVs.

Adopting and integrating EVs into the fleets of the public sector is another move governments and local bodies are doing to promote EVs and it is very effective.


The answer to the question is not a definitive one and answering it isn’t easy as well. We haven’t considered a lot of variables such as the incentives for the owners who have scraped their vehicles and the impact of those incentives etc.

Union Government has identified that to promote EVs, rigorous actions are to be taken and this scrappage policy is one among them and certainly helps in the faster adoption of EVs. But as I have mentioned a lot of variables are involved in this and it all goes to the hands of the end-user and that’s us.

Thus, it’s our responsibility to keep our roads and cities pollution-free and more pleasant and what’s better than making our next car an EV to make it happen…?

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