New Delhi (India), June 3: The Union Cabinet on Thursday approved a two-year scheme to promote cleaner mobility and accelerate the replacement of old, high-emission trucks and buses with BS-VI compliant vehicles and electric vehicles (EVs).
The scheme will be funded through the National Capital Region Planning Board (NCRPB) under the Ministry of Housing and Urban Affairs.
It will be implemented by the Ministry of Road Transport and Highways (MoRTH) and the Ministry of Petroleum and Natural Gas (MoPNG) in coordination with Delhi, Haryana, Rajasthan and Uttar Pradesh, according to an official release.
With a total financial outlay of Rs 9,585 crore, the scheme includes Rs 5,041 crore from the Central Government and an estimated Rs 1,601 crore in tax concessions from participating states.
The initiative aims to encourage owners of trucks and buses registered in Delhi-NCR that meet BS-IV or earlier emission standards to replace them with BS-VI or stricter emission-compliant vehicles or electric vehicles.
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Focus on Reducing Vehicular Pollution
The government said the transport sector is a major contributor to air pollution in Delhi-NCR, especially during winter months.
According to the source apportionment study by the Automotive Research Association of India (ARAI) and The Energy and Resources Institute (TERI), the transport sector contributes around 14% of PM 2.5 emissions, 40% of carbon monoxide (CO), and 63% of nitrogen oxide (NOx) emissions in the region.
Trucks and buses, despite forming only around 3% of the total vehicle fleet, contribute nearly 36% of PM 2.5 emissions from the transport sector.
The government highlighted that a single pre-BS heavy-duty vehicle can emit pollution equivalent to around 14 BS-VI compliant vehicles, while BS-IV vehicles emit about 2.7 times more than BS-VI vehicles.
Who Will Benefit?
The scheme is expected to benefit around 2.07 lakh vehicle owners, including approximately:
1.91 lakh trucks
16,329 buses
The beneficiaries will include vehicle owners in Delhi, Haryana, Rajasthan and Uttar Pradesh.
Under the scheme, BS-III or older vehicles will have to be scrapped at authorised Registered Vehicle Scrapping Facilities. BS-IV vehicles can either be scrapped or sold outside NCR in non-NCAP cities and towns.
Vehicle owners will then need to purchase and register BS-VI compliant or electric vehicles within NCR.
In Delhi, light goods vehicles purchased under the scheme will have to be electric, while buses will be required to be BS-VI CNG or electric.
Government vehicles will not be covered under the scheme.
Incentives for Vehicle Owners
The Centre will provide several financial benefits, including:
5% interest subvention on loans for five years
Monthly fuel vouchers of up to ₹4,800 depending on vehicle category
Lump-sum benefits for EV purchases or Certificate of Deposit trading
State governments will provide additional support through:
Waiver of registration fees
Up to 100% motor vehicle tax concession for new vehicles
50% tax concession for used vehicles for 10 years
Waiver of pending liabilities on old vehicles participating in the scheme
Participating automobile manufacturers will also offer an 8% discount on ex-showroom prices.
Digital Monitoring System
The scheme will be implemented through an integrated digital portal to ensure transparency and faster delivery of benefits.
The portal will enable real-time eligibility checks, automated interest subsidy claims, monthly fuel voucher credits and monitoring of pollution reduction.
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The central government benefits will continue for five years from the date of registration of the new vehicle, ensuring long-term impact beyond the two-year enrolment period.
Ends.
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