Union Finance Minister Nirmala Sitharaman on Monday said during the Budget speech for 2021-’22 that the Centre has proposed a voluntary vehicle scrapping policy in an effort to tackle air pollution.

“We are separately announcing a voluntary vehicle scrapping policy, to phase out old and unfit vehicles,” the finance minister said. “This will help in encouraging fuel-efficient, environment friendly vehicles, thereby reducing vehicular pollution and oil import bill. Vehicles would undergo fitness tests in automated fitness centres after 20 years in case of personal vehicles, and after 15 years in case of commercial vehicles.”

The finance ministry will separately share the details of the scheme, Sitharaman said.

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Last week, Union Road Transport Minister Nitin Gadkari had said that the policy to eliminate vehicles that are government-owned and those under public sector undertaking vehicles and over 15 years old would be notified and implemented from April 1, 2022. The policy has already been approved by the Centre, according to PTI.

On July 26, 2019, the Centre had suggested amendments to motor vehicle regulations to allow scrapping of vehicles more than 15 years old. This was done in a bid to adopt electric vehicles. In May 2016, the central government had released a draft Voluntary Vehicle Fleet Modernisation Programme, which proposed to take 28 million decade-old vehicles off the road.

In her speech, the Union minister said the Narendra Modi government was prepared to revive the Indian economy that has plunged into the deepest recorded slump due to the coronavirus crisis. Sitharaman also announced an outlay of Rs 35,000 crore for India’s coronavirus vaccination programme. She added that the Centre will make additional allocations to this fund when required.

The finance minister also announced the Aatmanirbhar Health Yojana with an outlay of Rs 64,180 crore over six years. India, which has the world’s second highest coronavirus cases after the United States, currently spends about 1% of Gross Domestic Product on the health sector. In Monday’s Budget, the allocation for health increased by 137% against the budgeted expenditure from the previous year.

The finance ministry also proposed to increase the foreign direct investment limit in the insurance sector from the existing 49% to 74%. The Narendra Modi-led government also said it will undertake new road infrastructure projects in four states – Tamil Nadu, Kerala, Assam and West Bengal – that will go to polls this year.