The much-awaited vehicle scrapping policy is all set for an announcement shortly. This policy will help the automobile sector to drive demand and cut emission levels. Scrappage policy will be putting a cap on the life of vehicles in terms of years or kilometers run. In other words, it is basically a provision of providing financial incentives to the owners of vehicles so that they can scrap the outdated models and replace them with the newer vehicles.
According to a media report, it is being estimated that if old vehicles are scrapped out of the system then it will help in reducing pollution. This will, in turn, induce demand for new vehicles. Further, this policy is also expected to help the automobile industry by reducing the need to import raw materials such as copper and aluminum.
If sources are to be believed, then this policy had been in works for over six months now. It is basically an attempt to boost the automobile demand by the government. It has although received clearance from all quarters, still a cabinet note is pending. The policy is expected to release in the next 15-30 days.
According to a media report, the government is trying to introduce alternative fuels such as ethanol, methanol, bio-diesel for the reduction of pollution. Once the Cabinet note has been floated, it will introduce a 15 percent blending of methanol into petrol and diesel. Along with this, it will also reduce the import bill of fuel and lower vehicle pollution.