**Executive Summary**
This document is the response of the Minister of Road Transport and Highways to an unstarred question (No. 1147) in the Lok Sabha, answered on February 5th, 2026. It details the government's policy and plans for recycling and scrapping old vehicles in India, including the Voluntary Vehicle Fleet Modernisation Programme (VVMP), the establishment of Registered Vehicle Scrapping Facilities (RVSFs), and incentives for individuals and companies. The response also addresses the environmental and economic benefits of vehicle recycling and scrapping.
**Key Points / Main Content**
* **Voluntary Vehicle Fleet Modernisation Programme (VVMP):**
* The Government has formulated the VVMP to address vehicular pollution.
* VVMP promotes voluntary scrapping of old and unfit commercial and personal vehicles.
* **Registered Vehicle Scrapping Facilities (RVSFs):**
* A network of RVSFs is being established for environmentally friendly vehicle scrapping/disposal.
* The government has notified the Motor Vehicles (Registration and Functions of Vehicle Scrapping Facility) Rules, 2021 (as amended).
* As of February 2nd, 2026, there are 129 operational RVSFs in the country, including 2 in Karnataka (1 in Bengaluru).
* RVSFs may be owned and operated by any legal entity after receiving a Registration Certificate from the State/UT Government.
* **Incentives for Vehicle Scrapping:**
* Exemption from registration fees upon submission of ‘Certificate of Deposit’ (GSR 714 (E) dated 04.10.2021).
* Concession in motor vehicle tax (up to 25% for non-transport vehicles and up to 15% for transport vehicles) upon submission of "Certificate of deposit" (GSR 720 (E) dated 05.10.2021). The concession is available for up to 8 years for transport vehicles and 15 years for non-transport vehicles.
* Motor vehicle tax concessions of up to 50% for vehicles manufactured as per BS-I norms and earlier, and all medium/heavy goods and passenger vehicles that are manufactured as per BS-II norms (GSR 200 (E) dated 26.03.2025).
* **Environmental and Economic Benefits:**
* Environmentally friendly scrapping of unfit/old vehicles by RVSFs.
* Promotion of circular economy by boosting the availability of low-cost raw materials.
* Encourages replacement of old vehicles with new fuel-efficient and cleaner alternatives (EVs and hybrid models) complying with better emission norms (BS-VI).
**Impact Analysis**
**Citizens (Vehicle Owners)**
* **Impact:** Citizens are incentivized to scrap old and unfit vehicles through exemptions in registration fees and tax concessions.
* **Action Required:** Citizens can avail the provided incentives for scrapping old vehicles at RVSFs and purchase new fuel-efficient or electric vehicles.
**Private and MSME Sector**
* **Impact:** MSMEs and private entities are encouraged to invest in setting up RVSFs.
* **Action Required:** Interested investors must comply with eligibility requirements to set up an RVSF after receiving a Registration Certificate from the respective State/UT Government.
**Automotive, Steel, and Electronics Industry**
* **Impact:** Increased availability of low-cost raw materials (steel, copper, aluminum, rubber, etc.) due to vehicle scrapping.
* **Action Required:** The automotive, steel and electronics industries can benefit from lower raw material costs.
Key Entities Referenced
Voluntary Vehicle Fleet Modernisation Programme (VVMP): A program to address concerns on vehicular pollution and envisages voluntary scrapping of old and unfit commercial and personal vehicles.
Motor Vehicles (Registration and Functions of Vehicle Scrapping Facility) Rules, 2021: Rules governing the establishment and operation of Registered Vehicle Scrapping Facilities (RVSFs).
Ministry of Road Transport and Highways: The primary ministry responsible for policy related to vehicle scrapping and recycling.
Registered Vehicle Scrapping Facilities (RVSFs): Facilities established for environment friendly scrapping/disposal of vehicles as part of the VVMP.
Karnataka: A specific state mentioned in the document as having established vehicle scrapping facilities.
GOVERNMENT OF INDIA
MINISTRY OF ROAD TRANSPORT AND HIGHWAYS
LOK SABHA
UNSTARRED QUESTION NO. 1147
ANSWERED ON 5th FEBRUARY, 2026
RECYCLING AND SCRAPPING OF OLD VEHICLES
1147. SHRI P C MOHAN:
Will the Minister of ROAD TRANSPORT AND HIGHWAYS
सड़क परिवहन औि िाजमार्ग मंत्री
be pleased to state:
(a) whether the Government has implemented any policy for the
recycling and scrapping of old and unfit vehicles, including cars, two-
wheelers and commercial vehicles, to reduce pollution and promote
resource recovery;
(b) if so, the number of registered vehicle scrapping and recycling
centres established so far across the country including Karnataka,
particularly in Bengaluru;
(c) whether any incentives are being offered to individuals or
companies for scrapping old vehicles and purchasing new fuel-
efficient or electric vehicles, if so, the details thereof;
(d) the estimated environmental and economic benefits expected from
large-scale vehicle recycling and scrapping; and(e) the future plans of the Government to develop vehicle scrapping
and recycling as an organised industry with strong participation from
the private and MSME sector?
ANSWER
THE MINISTER OF ROAD TRANSPORT AND HIGHWAYS
(SHRI NITIN JAIRAM GADKARI)
(a) The Government has formulated the Voluntary Vehicle Fleet
Modernisation Programme (VVMP) to address concerns on vehicular
pollution and envisages voluntary scrapping of old and unfit
commercial and personal vehicles.
Under VVMP, a network of Registered Vehicle Scrapping
Facilities (RVSFs) is being established for environment friendly
scrapping/disposal of vehicles. In order to facilitate establishment of
these facilities, the Government has notified the Motor Vehicles
(Registration and Functions of Vehicle Scrapping Facility) Rules, 2021
vide GSR 653 (E) dated 23.09.2021 (further amended vide GSR 695(E)
dated 13.09.2022, GSR 212(E) dated 15.03.2024 and GSR 700(E) dated
19.09.2025).
(b) As of 02.02.2026, there are 129 RVSFs operational in the country.
The State of Karnataka has 2 operational RVSFs, out of which 1 is in
Bengaluru.
(c) The following incentives are provided to citizens for scrapping of
their vehicles at RVSF: -
(i) GSR 714 (E) dated 04.10.2021 provides that, in case the
vehicle is registered on submission of ‘Certificate of Deposit’, the
fee for issue of certificate of registration shall not be levied.(ii) GSR 720 (E) dated 05.10.2021 provides for concession in the
motor vehicle tax (upto twenty-five per cent., in case of non-
transport vehicles and upto fifteen per cent, in case of transport
vehicles) for the vehicle registered against submission of
"Certificate of deposit". Provided that this concession shall be
available upto eight years, in case of transport vehicles, and upto
fifteen years, in case of non-transport vehicles.
(iii) GSR 200 (E) dated 26.03.2025 provides for concession in the
motor vehicle tax of up to fifty percent against such certificate
for all transport and non-transport vehicles which are
manufactured as per Mass Emission Standards Bharat Stage I
(BS-I) norms and earlier Mass Emission Standard norms and all
medium and heavy goods motor vehicles and all medium and
heavy passenger motor vehicles which are manufactured as per
Mass Emission Standards Bharat Stage II (BS-II) norms.
(d) The following environmental and economic benefits are achieved
through large scale vehicle recycling and scrapping: -
(i) Scrapping of unfit/old vehicles is done in an environment
friendly manner by RVSFs in compliance with guidelines issued
by the government.
(ii) Promotion of circular economy as scrapping of vehicles
boosts availability of low-cost raw materials (such as steel,
copper, aluminium, rubber, etc.) for automotive, steel and
electronics industry.
(iii) Scrapping of vehicles encourages replacement of old
vehicles with new fuel-efficient and cleaner alternatives
including EVs and hybrid models. New vehicles also comply with
better emission norms (BS-VI) and are thus less polluting than
those complying with older emission norms.(e) As per rule 5 of the Motor Vehicles (Registration and Functions of
Vehicle Scrapping Facility) Rules, 2021, the RVSF may be owned and
operated by any legal entity, be it a person, firm, society, Company
(including recyclers for ship breaking and recycling, plastic recycling
and others) or trust established in accordance with law. Any
interested investor including Micro, Small and Medium Enterprises
(MSMEs) complying with the eligibility requirements as stated in these
rules can setup an RVSF after receiving a Registration Certificate from
the respective State/UT Government. As of 02.02.2026, there are 129
operational RVSFs which are established by private entities (including
MSMEs).
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