Cabinet approves ₹9,585-crore scheme to replace old trucks, buses in Delhi-NCR

The Union Cabinet on Wednesday approved a ₹9,585-crore scheme to incentivise the replacement of old trucks and buses in the Delhi-NCR region with cleaner BS-VI, CNG and electric vehicles.

The two-year scheme, to be funded through the National Capital Region Planning Board (NCRPB) under the Ministry of Housing and Urban Affairs, will be implemented by the Ministries of Road Transport and Highways and Petroleum and Natural Gas.

Information and Broadcasting Minister Ashwini Vaishnaw told reporters that the scheme is part of the government’s push to tackle pollution in the national capital region through plantation drives, electric mobility and charging infrastructure.

"Several steps have recently been taken to bring Delhi's pollution under control. Major focus has been placed on cleaning initiatives, plantation drives, the adoption of electric vehicles, the creation of charging infrastructure and several other such measures," Vaishnaw said.

"Therefore, a scheme has been introduced for the replacement of old vehicles with modern, lower-emission BS6, CNG and electric vehicles. Specifically, it focuses on replacing old trucks and buses," he added.

The scheme has a total financial outlay of ₹9,585 crore, including ₹5,041 crore from the Centre and an estimated ₹1,601 crore in tax concessions from participating states.

It seeks to encourage owners of trucks and buses registered in Delhi-NCR that comply with Bharat Stage-IV or earlier emission norms to replace them with BS-VI or stricter emission-compliant vehicles, or electric vehicles.

According to the government, around 2.07 lakh vehicle owners, comprising about 1.91 lakh trucks and 16,329 buses, are expected to benefit from the programme.

The scheme will “create a natural incentive for people to replace their old trucks and buses,” Vaishnaw said.

Heavy vehicles a major source of pollution

The decision comes amid concerns over the contribution of heavy vehicles to air pollution in the region.

Citing a source apportionment study by the Automotive Research Association of India (ARAI) and The Energy and Resources Institute (TERI), the government said the transport sector contributes 14% of PM2.5 emissions, 40% of carbon monoxide emissions and 63% of nitrogen oxide emissions in Delhi-NCR.

Within the transport sector, trucks and buses account for 36% of PM2.5 emissions despite constituting only about 3% of the total vehicle fleet, it said.

The government said a single pre-BS vehicle emits as much pollution as 14 BS-VI-compliant heavy-duty vehicles, while a BS-IV vehicle emits 2.7 times more than a BS-VI counterpart.

Eligibility and replacement conditions

Under the scheme, owners of BS-III or older vehicles will have to scrap their vehicles at registered vehicle scrapping facilities.

BS-IV vehicles can either be scrapped or sold outside the NCR in non-National Clean Air Programme (NCAP) cities and towns.

Beneficiaries have to purchase and register a BS-VI, stricter-emission-compliant or electric vehicle within NCR to avail of incentives.

In Delhi, light goods vehicles purchased under the scheme must be electric, while buses will be permitted only in BS-VI CNG or electric variants.

Government-owned vehicles will not be eligible for the scheme.

Incentives from Centre, states and manufacturers

The Centre will provide a 5% interest subvention on loans for five years, monthly fuel vouchers worth up to ₹4,800 depending on vehicle category, and lump-sum incentives for electric vehicle purchases or certificate of deposit trading.

Participating state governments will waive registration fees and provide motor vehicle tax concessions of up to 100% for new vehicles and 50% for used vehicles for a period of 10 years.

They will also waive pending liabilities on old vehicles enrolled under the scheme.

Automobile manufacturers participating in the programme will offer discounts of 8% on ex-showroom prices of eligible vehicles, the government said.

The scheme will be implemented through an integrated digital portal that will facilitate eligibility checks, interest subvention claims, fuel voucher credits and monitoring of pollution-reduction outcomes.

An empowered committee headed by the Cabinet Secretary will oversee implementation, while district collectors and district magistrates will monitor the programme at the local level.

The government said benefits provided by the Centre will continue for five years from the date of registration of the new vehicle, extending support beyond the two-year enrollment period.