Major policy push: The Centre will fund a ₹9,585 crore scheme to replace old trucks and buses in Delhi-NCR with cleaner BS-VI or electric vehicles over two years.
Incentives for owners: Benefits include 5% loan interest subvention, monthly fuel vouchers, tax waivers, and OEM discounts to encourage scrapping or upgrading vehicles.
Pollution reduction goal: Targeting 2.07 lakh vehicles, the scheme aims to cut high PM2.5, CO, and NOx emissions from older diesel fleets, improving regional air quality.
Cabinet approves ₹9,585 crore fleet renewal drive
The Union Cabinet has sanctioned a two-year, ₹9,585 crore scheme to replace 1.91 lakh trucks and 16,329 buses in Delhi-NCR that meet BS-IV or older norms. Funded through the National Capital Region Planning Board, the initiative includes ₹5,041 crore from the Centre and about ₹1,601 crore in state tax concessions. Implementation will involve MoRTH, MoPNG, and NCR states, with oversight by an empowered committee chaired by the Cabinet Secretary
How the scheme will be implemented and monitored
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Implementation will be fully digital through an integrated portal for real-time eligibility checks and monitoring.
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District Collectors and District Magistrates will oversee local implementation and compliance.
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An Empowered Committee, chaired by the Cabinet Secretary, will monitor the scheme with key ministry and state officials.
Incentives designed to speed up adoption
Eligible owners will get a 5% interest subvention on loans for five years, monthly fuel vouchers worth up to ₹4,800, and lump-sum benefits for EV purchases or certificate trading. States will waive registration fees and offer up to 100% motor vehicle tax exemptions for new vehicles and 50% for used ones for a decade. Participating OEMs will provide 8% ex-showroom discounts, and all benefits will be processed via a digital portal for real-time verification and monitoring
Tackling NCR’s pollution hotspots
Studies by ARAI and TERI show the transport sector accounts for 14% of PM2.5, 40% of CO, and 63% of NOx emissions in NCR, with trucks and buses responsible for 36% of PM2.5 despite being only 3% of the fleet. A single pre-BS heavy-duty vehicle emits as much as 14 BS-VI units, while BS-IV vehicles emit 2.7 times more than BS-VI models. By mandating scrappage or relocation of older vehicles, the scheme targets a major pollution source.
Special rules for vehicle replacement
BS-III and older vehicles must be scrapped at authorised facilities, while BS-IV models can be scrapped or sold outside NCR in non-NCAP areas. In Delhi, light goods vehicles purchased under the scheme must be electric, and buses must be BS-VI CNG or electric. Government-owned vehicles are excluded from the programme, and all transactions will be recorded through a fully digital portal to ensure compliance and track pollution reduction outcomes.
