The Budget has proposed for vehicles to undergo fitness tests in automated fitness centres after 20 years in case of personal vehicles, and after 15 years in case of commercial vehicles.

Details of the scheme will be separately shared by the Ministry, Finance Minister, Nirmala Sitharaman, said in her speech.

“We are separately announcing a voluntary vehicle scrapping policy, to phase out old and unfit vehicles. This will help in encouraging fuel-efficient, environment friendly vehicles, thereby reducing vehicular pollution and oil import bill,” she said.

The FM has also proposed for revising duty rates on certain items, including auto parts immediately.

“We propose to withdraw exemptions on tunnel boring machines. It will attract a customs duty of 7.5 per cent; and its parts a duty of 2.5 per cent. We are raising customs duty on certain auto parts to 15 per cent to bring them on par with the general rate on auto parts,” Sitharaman said.

Also read: Automobile sales register 14 per cent growth in December

There is an immense potential in manufacturing heavy capital equipment domestically and therefore, the government will comprehensively review the rate structure in due course.

Meanwhile, to give a fillip to the public transport system, the Budget has proposed raising the share of public transport in urban areas through expansion of metro rail network and augmentation of city bus service.

A new scheme will be launched at a cost of ₹18,000 crore to support augmentation of public bus transport services. The scheme will facilitate deployment of innovative public private partnership (PPP) models to enable private sector players to finance, acquire, operate and maintain over 20,000 buses.

“The scheme will boost the automobile sector, provide fillip to economic growth, create employment opportunities for our youth and enhance ease of mobility for urban residents,” she added.

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