India will do away with toll booths and implement GPS based toll collection within one year, said road transport and highways minister Nitin Gadkari in the Lok Sabha today.

The minister also unveiled the government’s vehicle scrapping policy, proposed in the Union Budget, in a suo moto statement made in both Houses of Parliament, under which about 5 per cent rebate on new cars would be offered to buyers on scrapping of old vehicles.

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Mr Gadkari, speaking in the Lower House during Question Hour, said 93 per cent of vehicles pay toll using FASTag, but the remaining 7 per cent have still not adopted it despite paying a double toll. “I want to assure the House that within one year all physical toll booths in the country will be removed. It means that toll collection will happen via GPS.

The money will be collected based on GPS imaging (on vehicles),” he said. Explaining further, the minister said he has instructed police inquiry for those vehicles which do not pay toll using FASTag. “There are cases of toll theft and GST evasion cases if FASTag are not fitted in vehicles,” he said.

FASTag, which facilitates electronic payment of fee at toll plazas, was introduced in 2016. From 16 February, vehicles without FASTag are required to pay double toll fees at electronic toll plazas across the country.

“Making the tags compulsory would also help in ensuring that vehicles pass seamlessly through the toll plazas, as the fee payment would be done electronically,” said Mr Gadkari.

Briefing the House about the vehicle scrapping policy, he said it provides for fitness test after 20 years for personal vehicles while commercial ones would require it after the completion of 15 years. If found unfit or in case of a failure to renew registration certificates, such vehicles would be de-registered.

“The scheme shall provide strong incentives to owners of old vehicles to scrap old and unfit vehicles through registered scrapping centres, which shall provide the owners with a scrapping certificate,” Mr Gadkari said.

The incentives provided under the scheme say a scrap value to be given for the old vehicle will be four to six per cent of the ex-showroom price of a new vehicle. The state governments may be advised to offer road-tax rebate of up to 25 per cent for personal vehicles and up to 15 per cent for commercial vehicles.

Vehicle manufacturers will be advised for providing a discount of five per cent on purchase of new vehicle against the scrapping certificate. In addition, the registration fees may also be waived for purchase of new vehicle against the scrapping certificate.

As a disincentive measure, increased fees for fitness certificate and fitness test may be applicable for vehicles 15 years onward from the date of initial registration.

India has 51 lakh Light Motor Vehicles which are older than 20 years and 34 lakh Light Motor Vehicles which are older than 15 years. Older vehicles pollute the environment 10 to 12 times more than fit vehicles and pose a risk to road safety, the minister said.

The objectives of the policy are to reduce of old and defective vehicles, achieve reduction in vehicular air pollutants to fulfil India’s climate commitments, improve road and vehicular safety.

The ecosystem is expected to attract additional investments of around Rs. 10,000 crore and 35,000 job opportunities. The Ministry shall in the next few weeks publish draft notifications for comments.

The Ministry will promote setting up of Registered Vehicle Scrapping Facility (RVSF) across India. In the Rajya Sabha, several MPs complained the Vehicle Scrapping Policy offered meagre concessions to vehicle owners, and urged the minister to keep the interests of the middle classes in mind.