The Vehicle Scrappage Policy was announced in the parliament in early 2021 with the aim to offer a much-needed boost for the Indian auto sector, which hasn't been performing optimally since the pandemic broke out. The outlook was that the scrappage policy could lead to a significant growth of 30 per cent in the Indian automobile industry, with a significant reduction in components cost. Over 1.2 crore vehicles have been identified for scrapping and there are more than 20 scrappage centres in the country today. But, the country has the potential to have three scrappage centres in each district.
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Gadkari said, “But we have a potential to start at least three scrapping centres in one district and it can be a great asset for you because of the scrubbing centres, there will be the particularly it is to be most important for you that because of scrapping centre you will get this copper, aluminium, steel, rubber and plastic waste material, you can make the recycling of it and you can reduce the cost of your component by 30 per cent. I feel that this is the time that every automobile industry, even the big manufacturer like you, if you can make your scrapping centre in different districts, and if you can use that raw material for your components is going to reduce the cost it can be really good for you regarding the pollution one world truck is equivalent to pollution of 15 new trucks”. 
He said that scrappage will have two-fold benefits, one would be from the ecological and environmental point of view and the second is that by reusing and recycling automotive components from vehicles that will be scrapped, the cost can be reduced significantly.
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Under the scrappage policy, old vehicles will have to pass a fitness test before re-registration and, as per the policy, government commercial vehicles more than 15 years old and private vehicles which are over 20 years old will be scrapped. Beginning April 1, 2023, fitness testing of Heavy Commercial Vehicles (HCVs) shall be conducted only through Automated Testing Stations (ATSs). For other types of Commercial Vehicles and Private Vehicles (PVs), the fitness testing shall also be conducted through the ATS and begin on June 1, 2024.
