The Road Transport and Highways Ministry has issued notifications that all vehicles would now be allowed retrofitting of hybrid electric kits to convert them into hybrid electric vehicles. The Supreme Court pulled up the said ministry recently for not doing much to reduce pollution levels, following which the ministry began allowing conversion of vehicles into electric hybrid vehicles.
Besides, the ministry will also offer various incentives and discounts for those surrendering their vehicles, registered before 31 March 2015, to have them scrapped. Vehicles older than ten years can be surrendered to have them scrapped to avail incentives and discounts. Meanwhile, it could also be remembered that the government banned diesel vehicles with displacements of over 2.0-liter or 2000 cc in Delhi-NCR.

The benefits for surrendering of vehicles for scrapping will be a 50 percent discount on excise duty, while purchasing new cars. The Ministry will also have manufacturers provide 8 to 12 percent discounts, during the purchase of new vehicles, for customers who surrendered their vehicles for scrapping. Vehicle owners can now convert their vehicles into electric hybrids and also surrender older vehicles for scraping and avail tax discounts and purchase price discounts.

The Ministry already held a meeting with hybrid electric kits manufacturers like Bosch and Cummins to encourage them to produce more kits. Following this, the Ministry will also certify authorized hybrid electric kits manufacturers, while the manufacturers will list all the authorized installation centers of hybrid electric kits.

Through these measures, BS-II and BS-III compliant vehicles will either go out of existence or get converted into electric hybrids to save fuel consumption and reduce pollution levels. The total cost of conversion into electric hybrids will be less than Rs. 1 lakh now, which is expected to further reduce upon rise in demand and when economies of scale begins to operate.

The road transport and highways ministry will also recommend and demand the heavy industries ministry to offer incentives to these vehicle owners under the National Electric Mobility Mission plan. The scrapping of old vehicles is part of the Voluntary Vehicle Fleet Modernization (V-VMP) plan. It is under this plan that the 50 percent discount on excise duty on purchase of new vehicles is offered for owners surrendering old vehicles for scrapping.

With such offers, the Ministry estimates that 28 million of these vehicles would go non-existent to save 3.2 billion liters of fuel per year, which will in turn reduce the Rs. 7000 crore burden on India’s current accounts via lower crude imports. If incentives and discounts may not be entirely possible, the ministry may offer cash benefits to those scrapping their cars.