CoS to Take up Fleet Pol­icy for Nod this Week

The Economic Times - - Economy: Macro, Micro & More - Ra­jat.Arora@ times­group.com

New Delhi: The Com­mit­tee of Sec­re­taries (CoS) will take up for ap­proval the fleet mod­erni­sa­tion pol­icy that pro­poses to re­move old and pol­lut­ing trucks and other com­mer­cial ve­hi­cles bought be­fore April 2005 from the roads.

The fleet mod­erni­sa­tion pro­posal mooted by the roads trans­port and high­ways min­istry has been await­ing clear­ance for al­most a year now. The com­mit­tee has sec­re­taries from the min­istry of fi­nance (rev­enue sec­re­tary), en­vi­ron­ment, steel, heavy in­dus­try, roads and law min­istry as its mem­bers.

“The pol­icy will be taken up by the CoS on Fe­bru­ary 9. It will not only cut pol­lu­tion by tak­ing pol­lut­ing ve­hi­cles off the roads but will also in­crease the rev­enues of the gov­ern­ment be­cause the life­cy­cle of the ve­hi­cles would be fixed. Auto com­pa­nies will also have in­creased sales,” road trans­port and high­ways min­is­ter Nitin Gad­kari said.

Un­der the pro­posed pol­icy, com­mer­cial ve­hi­cles bought be­fore April 2005 will be el­i­gi­ble for in­cen­tives if re­placed by new ones. Ac­cord­ing to gov­ern­ment es­ti­mates, the pro­gramme may help re­place sev­eral mil­lion ve­hi­cles with lesspol­lut­ing ones, thereby re­duc­ing ve­hic­u­lar emis­sion. The pro­posal will also be put be­fore GST Coun­cil as the scheme of­fers tax in­cen­tives.

The pol­icy pro­poses three in­cen­tives for the ve­hi­cles scrapped — half the reg­u­lar ex­cise duty at the time of pur­chase of new ve­hi­cle, fair value for the scrap and dis­counts from au­to­mo­bile man­u­fac­tur­ers. Th­ese in­cen­tives are likely to cut the cost of a new ve­hi­cle for the buyer by 15% on an av­er­age.

The trans­port min­istry last year re­leased the first draft of the pro­posed pol­icy. It rec­om­mends comp- lete ex­cise ex­emp­tion for state trans­port buses to en­cour­age pub­lic trans­port to shift to newer and higher ca­pac­ity buses which will also help de-con­gest roads.

Un­der the plan, those opt­ing to scrap old com­mer­cial ve­hi­cles will have to de­posit doc­u­ments re­lat­ing to the ve­hi­cle at the re­cy­cling cen­tre. After ver­i­fi­ca­tion, the owner will get a cer­tifi­cate and the price for the scrap. He has to pro­vide cer­tifi­cate to the dealer while buy­ing the new ve­hi­cle to avail of the dis­count.

Ac­cord­ing to the min­istry, the pol­icy has the po­ten­tial to re­duce ve­hic­u­lar emis­sion by 25% and save oil con­sump­tion by 3.2 bil­lion litres a year. “The re­duc­tion in oil con­sump­tion by new ve­hi­cles will help save nearly ₹ 7,000 crore in oil im­port,” said the con­cept note on the pol­icy by trans­port min­istry.

“We will soon make a pre­sen­ta­tion to the GST Coun­cil as well,” Gad­kari said.

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