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Vehicle Recycling – Indian Challenge

Prabhat Khare, a senior auto industry veteran and an engineering and energy consultant, safety auditor, and trainer from India, shares his views with Auto Recycling World on the present scenario of vehicle recycling in India and the potential challenges associated with its growth in developing countries.


Vehicle Recycling - Indian Challenge – Part 1 of 2 PK post
Prabhat Khare

With the opening of the automotive market around 1990, India saw an extraordinary rise in the number of vehicles on the roads [for the record, the number of vehicles on the roads of India grew from a mere 29.49M (1972~1996) to 343.74M (1997~2020) and is expected to reach 1,660.89M (2021~2040)]. 

In a country where owning an automobile has always been associated as a status symbol, this increase brought in a big challenge concerning the parting with the vehicle for disposal, scrapping, or recycling, once it becomes old. Unlike advanced countries where the automobile recycling systems evolved in tandem with the growth of the automotive industry, India has been lagging in developing this mindset. The result was that these old vehicles were found parked at the owner’s house for the sake of sentimental value, dumped in unorganised scrap handling markets, or left at police stations – where many vehicles involved in accidents or stolen vehicles kept rising due to non-settlement of legal cases, while many times vehicles involved in accidents have been found abandoned in remote areas where they tend to decay in the open impacting the surrounding environment very badly.

However, in India, no vehicle was ever disposed of due to technology obsolescence. Despite such a peculiar situation in India, the situation was manageable as the number of vehicles on the roads were small. However, as the number of vehicles started growing, the impact of older vehicles started to cause chaos on the Indian roads, leading to large-scale air pollution as well as land and water contamination, from massive traffic congestions. Unfortunately, India was not ready to handle this situation and it neither had the proper infrastructure nor the proper regulatory mechanism for efficient and proper disposal of large volumes of vehicles on reaching their EOL.

Typical current dismantling flow of a vehicle in India

Vehicle Recycling - Indian Challenge – Part 1 of 2 image five

Thus the current “Vehicle Scrappage Policy 2021”1 by the Government of India is a well-timed and positive step in the right direction. It has been welcomed by both industry and the public.

The policy would help in identifying and disposing of vehicles of three main categories: 

  1. the physically old vehicles; 
  2. the vehicles which become technologically old, and
  3. Unworthy vehicles due to accidents, natural calamity, or even non-utilisation. 

Such vehicles will now be identified and barred by RTO2 registration.

The existing system offered no clear and quantified benefit to the person disposing of his old vehicle and was always at the mercy of local scrap dealers. This new policy by GoI3 takes care of this condition and offers a few defined incentives for scrapping old vehicles as well as giving certain disincentives (penalties) for retaining the aged vehicle. The purpose is to get rid of these old vehicles from the system, and in the process, they also get ‘recycled in a way to bring back maximum materials to the cradle, merging it with the ‘circular economy’.

1Vehicle Scrappage Policy 2021 was officially launched In India By PM Narendra Modi on 13.08.2021

2 The Regional Transport Office (RTO) is the organisation of the Indian government is responsible for maintaining a database of drivers and a database of vehicles for various states of India. Each district has its own RTO and comes under the jurisdiction of the respective states.

3 Government of India

Incentives for scrapping old vehicles and buying new ones Disincentives for keeping old vehicles
  • Vehicle Manufacturers can give up to 5% discount for buying new vehicles
  • Zero new registration fee
  • Scrap value equivalent of 4-6% of ex-showroom price of new vehicles
  • States can give up to 25% and 15% rebate on road tax for personal and commercial vehicles, respectively
  • States can levy an additional ‘Green Tax’
  • Hike in renewal of registration fee for private vehicles
  • Increase in renewal of fitness certification for commercial vehicles
  • Automatic deregistration of unfit vehicles making them unfit to ply on roads
However, there are a few categories of vehicles that are exempted from this policy e.g. hybrids and electric vehicles, vehicles using alternative fuels such as CNG, ethanol, and LPG, and Farm and agricultural equipment such as tractors, tillers, and harvesters.
Challenges in India

Publicity and incentivisation: The GoI must publicise this advanced way of disposal of old vehicles and the associated long-term benefits both to society and to individuals so that people come forward voluntarily to part with their old vehicles. This step is most critical in making this process acceptable in Indian society yet it is missing.

Tracking the old vehicles: This has been one of the biggest challenges for India, only since 2001, RTOs have been computerised. However, this problem is being taken care of by the GoI by introducing a few interlinked yet independent measures in the Indian mobility system – first, the computerisation of all state RTOs and their interlinking; second, the introduction of FASTags4 for highway toll collection/ travel tracking, and third, and most importantly, the introduction of HSRP (High-Security Registration Plates) from July 2022. These are being made mandatory all across the country and would help in the digital tracking of the complete life cycle of a vehicle. It is expected within a few years when the vehicular data gets cleaned up, authorities can get access to the correct and authentic real-time data of the actual number of vehicles, their ages, their running pattern, for example.

4 FASTag is an electronic toll collection system in India, operated by the National Highway Authority of India. It employs Radio Frequency Identification technology for making toll payments directly from the prepaid or savings account linked to it or directly to the toll owner.

Components of high security number plates (HSRP)

Vehicle Recycling - Indian Challenge – Part 1 of 2 image six
Front and rear plates The colour coded wind shield stickers
Vehicle Recycling - Indian Challenge – Part 1 of 2 image seven


Infrastructure and technology to handle the large volumes:
Vehicle Recycling - Indian Challenge – Part 1 of 2 im eight
Authorisation of CERO by GoI

The current infrastructure for vehicle dismantling in India is very unsystematic and is mainly controlled by local garages which have grown (in almost every city), from repairing shops to unauthorised disposal markets e.g. Mayapuri (Delhi)5, and Shivajinagar (Bangalore) to name two of India’s biggest scrap markets. The good news is that in 2018, Mahindra Intertrade Ltd. and s GoI enterprise MSTC Ltd (Metal Scrap Trade Corporation Ltd.) signed an agreement to form Mahindra MSTC Recycling Private Limited (MMRPL)6 which under the brand name of Mahindra-CERO7 will be offering its customers a first-of-its-kind, end-to-end solution for the scrapping of vehicles covering vehicle evaluation, arranging a quote for exchange/scrappage value of the vehicle, providing end-to-end services including vehicle pickup, transportation, and environment-friendly dismantling at CERO scrapyards. CERO will also be issuing the Certificate of Deposit/Destruction (COD), which will enable the customer to claim eligible benefits under the upcoming Scrappage Policy.

However, the Govt. needs to maximise such state-of-the-art dismantling centres in the outskirts of cities which have a higher concentration of ageing vehicles with good connectivity, and logistics facilities as none have come up in the country since 2018 after this JV of Mahindra.




Tracking, identification and accountability of parts/components: Once the parts are dismantled from old vehicles, they must be properly checked for quality, tagged, and stored for their usability and traceability to ensure performance once they are shipped for sale in the secondary market as spares.

Handling of new age electrical, hybrid vehicles: With the new focus of Govt. of India on EV and HEVs, in the coming few decades, these vehicles will also be coming for their recycling in due course when they reach their EOL (due to age, road accident, and damage or due to natural calamity). The Govt. should and must be clear that the present recycling plants must be capable of handling these new-age EVs and HEVs. The major challenge would be in handling the large set of spent Lithium-Ion Batteries (LIB).

Landfills: Although India already has well organised and controlled landfill site management systems in place for Hazardous Wastes, it needs to be restudied in light of the increased requirement of automotive waste expected to be generated in near future, and if needed, special landfill sites may be developed for this automotive waste.

Promotion to set up ASR treatment: Govt. must push the installation of the ASR Plant with the latest technology wherever Automobile recycling is done. Apart from this, there are many benefits; it will considerably reduce the landfill area requirements, it will be useful in the recovery of multi-layer of pure materials like Copper, Palladium, etc., it will eliminate the hazards involved in handling and the disposal of rubber and plastics and it will eliminate air pollution as well as groundwater contamination. 

In conclusion

Automobiles are one of the most hazardous engineering objects when it comes to their dismantling. And being a new means of disposal involving large numbers, India needs to learn and take precaution from its own world’s largest ship recycling operation – the Alang-Sosiya ship recycling yards – situated on the west coast of Gujarat and has nearly 120 active recycling yards dismantling end-of-life ships to extract various types of scraps and equipment for recycling and reusing. These ship breaking facilities, with an annual turnover of a whopping INR 6000 crores (US$ 800 Million) per year, brought many social and environmental issues which have been well recorded in many studies.

Unlike ship breaking facilities, which are far away from the human habitat, these automobile recycling facilities will be nearer to the human habitat, and any mishandling or malfunctioning will have a serious impact on their surroundings. Alang8 is already facing a severe water crisis due to groundwater depletion and contamination; there is a frightening list of diseases prevalent in that area which India cannot afford in areas where these automotive recycling plants are expected to function.

However, such a recycling policy should be based on the vehicle’s performance rather than its age, such as when its performance is continuously poor, then it must be disposed of by diverting it to an organised and professional recycling setup, which will pave the way for a modern “Vehicle Recycling Industry” as opposed to a “Vehicle Scrapping Industry”.

8 Alang is a census town in Bhavnagar district in the Indian state of Gujarat. Its beaches are currently the world’s largest ship graveyard.


  1. Vehicle Recycling, Toyota Motors, April 2017
  2. Development of Scientific Recycling Of End of Life Automobiles In India and The Role of Research & Development, Indian National Academy of Engineering, November 2015
  3. Processing End-of-Life Vehicles: A Guide for Environmental Protection, Safety and Profit in the United States-Mexico Border Area, July 2017
  4. Auto Salvage Recyclers Environmental Self–Audit Workbook, Indiana Department of Environmental Management, January 2017
About the author

Prabhat Khare is an Auto Industry Veteran from India (Tata Motors, Honda Cars & Ashok Leyland), an Engineering & Energy Consultant, Energy & Safety Auditor, Trainer, BE (Electrical), Gold Medallist, IIT Roorkee, Life Member of National Safety Council, BEE Certified Energy Manager and a Lead Assessor For ISO 9K, 14K, 45K & 50K.

If you would like to contact Prabhat, please email him at or Alternatively, you can connect with him via linkedin.