Using scrap car material saves 33% in raw material costs and increases new car sales by 18-20%.
Road Transport and Highways Minister Nitin Gadkari has said that car sales in India could increase by 18% as a result of the government’s scrappage policy, which mandates private diesel and petrol cars older than 10 years and buses older than 15 years. Said it was expensive. To be discarded. This policy will take effect from April 1, 2023.
“Using scrap car materials can save 33% in raw material costs and increase new car sales by 18-20%,” he said.
“However,” Gadkari said at the 63rd SIAM Annual Conference, “we will request automakers to give discounts on purchases for scrapped vehicles.”
As part of the vehicle scrapping strategy, the central government has provided incentives of Rs 200 billion to state governments through special support for capital investment in states during 2022-23.
Nitin Gadkari said the auto scrappage program will generate an additional GST revenue of Rs 40,000 crore for the government.
“Decommissioning of old vehicles will reduce India’s dependence on imported metals such as aluminum and copper as well as rubber and will help develop a circular economy,” Gadkari said at the convention.
He also said the government was working with industry to develop new technologies for electric vehicles, electric highways and the sustainable use of mine wastelands.
The Department for Road Transport and Highways is also consulting with the Treasury about the possibility of providing subsidies to encourage the voluntary scrapping of old vehicles.
It is estimated that India imports metals worth USD 34.7 billion every year.
China, South Korea, Japan, United Arab Emirates and the United States are India’s top five importers of metals.
Gadkari also said that recycling aluminum, copper, steel, rubber and plastic could reduce the cost of auto parts by 20-25%.
He also said in his speech that the Indian government intends to reduce India’s high logistics costs, which currently stand at 14-16%, through building new highways and using alternative fuels.
He further said, “India’s move towards a circular economy is significant and will soon enable the industry to reduce operating costs, thereby increasing export competitiveness.”
