India's Vehicle Scrappage: A Path to Economic and Environmental Revival

Union Minister Nitin Gadkari has announced a projected revenue of Rs 40,000 crore in Goods and Services Tax should all 97 lakh unfit and polluting vehicles in India be scrapped. Speaking at the ACMA Annual Session 2025, Gadkari highlighted the government's efforts in scrapping 3 lakh such vehicles, including 1.41 lakh government vehicles, by August this year.

The push, part of the Voluntary Vehicle Fleet Modernization Program (V-VMP), is designed to foster an ecosystem phasing out unfit vehicles while generating 70 lakh jobs. The initiative has already seen private sector investments totaling Rs 2,700 crore. The Vehicle Scrapping Policy aims to lower automobile component costs by 25 percent, reinvigorating the market.

Addressing energy concerns, Gadkari emphasized the nation's reliance on fossil fuel imports, costing Rs 22 lakh crore annually, and the push towards ethanol blending to reduce dependence. The minister also underscored road safety challenges, with a reported 5 lakh accidents and 1.8 lakh deaths in 2023. Gadkari assured that the E27 ethanol blending proposal will undergo rigorous testing before implementation.

(With inputs from agencies.)