India’s government has launched the National Automobile Scrappage Policy aimed at phasing out old vehicles in an environmentally-friendly way and providing benefits for steel and ancillary industries.

The policy will enable the recycling of personal vehicles older than 20 years starting from June 2024 and heavy commercial vehicles from April 2023.

The new policy will result in the recovery of materials including copper, aluminium, steel, rubber, and plastic, putting them back into production, Kallanish notes. “We aim for maximum recovery up to 99%. This will increase the availability of materials and reduce costs by up to 40% for raw materials, thereby fuelling India’s competitiveness globally,” says Indian transport minister Nitin Gadkari.

The recycling policy sees an investment of INR 10,000 crore ($1.35 billion) towards the development of scrapping infrastructure. “The policy is an important link to achieve the circular economy of waste-to-wealth and energise India’s auto sector and metal sector with the principle of reuse, recycle and recover,” says Prime Minister Narendra Modi.

Tata Group entity Tata Motors is setting up a Registered Vehicle Scrapping Facility (RVSF) in Ahmedabad to recycle up to 36,000 vehicles/year. A memorandum of association for the same was signed with the Gujarat government.

The Indian steel industry is heavily dependent on ferrous scrap and stakeholders are expecting a streamlined supply of scrap through vehicle recycling. The nation imported 5.39 million tonnes of scrap in the fiscal year through March 2021 (FY21), down from 6.77mt a year earlier.

Major scrap exporters to India in FY21 were United Arab Emirates (0.87mt), USA (0.62mt), UK (0.54mt), Singapore (0.38mt) and Australia (0.24mt).