Sensex Crashes 1,939 Points, Posts Worst Day In 11 Months
MUMBAI, Feb 26: The Indian equity benchmarks crashed on Friday and posted their worst single-day performance since March 30.
The Sensex and Nifty mirrored losses in losses in other global markets as a rout in global bond markets sent yields flying and spooked investors amid fears the heavy losses suffered could trigger distressed selling in other assets.
The Sensex dropped as much as 2,149 points or 4.2 per cent and Nifty 50 index crashed 4.2 per cent to fall below its important psychological level of 14,500 mark.
The Sensex tumbled 1,939 points or 3.8 per cent to close at 49,099.99 and Nifty 50 index cracked 3.76 per cent or 568 points to settle at 14,529.15.
"Low interest rates made the rally possible form levels of 7,500 and the Nifty has doubled from those levels in last 12 months now signs of interest rate reversal are visible which means liquidity will dry up and easy money will not sustain. Nifty can go down 13,900 levels in the near term given the high valuations Nifty is trading at," said A K Prabhakar, head of research at IDBI Capital.
MSCI's Emerging Markets equity index suffered its biggest daily drop in nearly 10 months and was 2.7 per cent lower, while European shares opened in the red, with the STOXX 600 down 0.7 per cent, recovering from heavier losses earlier in the session.
The MSCI world equity index, which tracks shares in 50 countries, was 0.9 per cent lower and heading for its worst week in a month.
Asia saw the heaviest selling, with MSCI's broadest index of Asia-Pacific shares outside Japan sliding more than 3 per cent to a one-month low, its steepest one-day percentage loss since May 2020.
Back home, selling pressure was so intense that all the 11 sector gauges compiled by the National Stock Exchange ended lower while India VIX, the volatility index, spiked 23 per cent.
Financial services and banking shares were the worst hit during the session, the Nifty Financial Service index tumbled 5 per cent and Nifty Bank index crashed 4.78 per cent.
Nifty Auto, PSU Bank, Realty, FMCG, IT and Media indexes also fell over 1.5 per cent each.
Broader markets also succumbed to the selling pressure as Nifty Midcap 100 and Nifty Smallcap 100 indexes dropped over a per cent each.
ALl shares in the Nifty 50 basket closed in the red with. ONGC was the top Nifty loser, the stock plunged 6.5 per cent to 111. Mahindra & Mahindra, Power Grid, JSW Steel, Hero MotoCorp, GAIL India, Bajaj Finserv, Axis Bank, Kotak Mahindra Bank, Grasim Industries and UPL also fell over 5 per cent.
The overall market breadth was extremely bearish as 1,853 shares ended lower while 1,062 closed higher on the BSE.
India's GDP in Third Quarter Shows Growth of 0.4%, Indicates Govt Data
NEW DELHI, Feb 26: After contracting for two quarters in a row, the Indian economy grew by 0.4% in the October-December quarter amid the coronavirus pandemic, data from the Ministry of Statistics and Programme Implementation released on Friday showed. The gross domestic product (GDP) had expanded by 3.3% in the corresponding period of 2019-20, according to data released by the National Statistical Office (NSO).
In its second advance estimates of national accounts, the NSO has projected an 8% contraction in 2020-21. In its first advance estimates released in January, it had projected a contraction of 7.7% for the current fiscal as against a growth of 4% cent in 2019-20.
The economy had shrunk by an unprecedented 24.4% in the first quarter this fiscal following the coronavirus pandemic and resultant lockdowns. In the second quarter, the GDP declined 7.3% due to a perk up in economic activities.
China’s economy grew by 6.5% in October-December 2020, faster than the 4.9% growth in July-September 2020.
Samsung Named No.1 Global TV Manufacturer for 15 Consecutive Years
NEW DELHI, Feb 24: Samsung Electronics topped the global TV market for the 15th consecutive year, according to market research firm, Omdia. Newly released data notes that Samsung Electronics recorded 31.8% in global TV market share by revenue in Q4 2020 and retained the largest annual category market share by revenue in 2020, at 31.9%.
Samsung’s growth across the Visual Display Business reflects a commitment to the most premium at-home viewing experiences, coupled with the fast-growing QLED portfolio, category leadership in the ultra large screen segment over 75-inches, the introduction and expansion of a Lifestyle TV portfolio, and a series of industry, category and product “firsts” made possible thanks to Samsung’s constant drive for innovation.
“Consumers use screens every day to entertain, connect with loved ones, work, exercise from home and do much more. And we have seen how different lifestyles and routines have not only evolved, but converged,” said Jong-hee Han, President of Visual Display Business at Samsung Electronics.
“We continue to be incredibly humbled by the trust placed in our vision and products; it is what drives our relentless pursuit to deliver cutting-edge innovation and a best-in-class screen experience that meets the needs of the modern-day consumer.”
Looking back over the last 15 years, Samsung’s innovation-led growth agenda has incorporated groundbreaking new technologies, while spanning multiple categories, reaching a wide range of consumers and use cases.
In 2021, Samsung expects to maintain its industry-leading market position with the introduction and expansion of core products and by incorporating proprietary technology and features across all TV lineups. This includes Samsung’s new Neo QLED lineup along with Samsung’s MICRO LED, Lifestyle TVs and a company-wide alignment of operations through long-term sustainability programs. Over the next few years, Samsung will also continue to invest in R&D and product development in strategic business areas to strengthen its core and emerging technology offers.
India, Singapore should invoke 3Bs -- Buddhism, Bollywood, Business: Piyush Goyal
By Deepak Arora
NEW DELHI, Feb 18: To further strengthen the India- Singapore economic and investment relations, the second meeting of India-Singapore CEOs forum was organized today.
Addressing the 2nd Meeting of India-Singapore CEOs Forum’, organized by FICCI, jointly with DPIIT, Govt of India, Piyush Goyal, Minister of Railways and Commerce and Industry, highlighted three Bs- Buddhism, Bollywood and Business, for enhancing India-Singapore relations.
Goyal also emphasized on creating a forum for women entrepreneurs, for both India and Singapore for sharing of experiences and success stories. He also stressed on education and skill development being key pillars for strengthening India- Singapore ties.
S Iswaran, Minister for Communications and Information & Minister-in-charge of Trade Relations, Govt of Singapore, urged for a greater engagement between the businesses on both sides. He emphasized on 3Ds- Development, Diversification and Digital Economy for building a partnership that will benefit the two economies.
Uday Shankar, President, FICCI, said that India-Singapore enjoys multifaceted strategic relations and both nations are supporting each other in the endeavour to reinvigorate multilateralism.
Harshavardhan Neotia, Co-Chair, India-Singapore CEO Forum, Past President, FICCI and Chairman, Ambuja Neotia Group said that the Forum will focus on two working groups, viz., Innovative technologies and Advanced Manufacturing. It would cover the aspects of women empowerment in business, education and skills, in these areas. He also emphasised facilitating collaboration in Artificial Intelligence, IoT, blockchain and Big Data, Advanced manufacturing, Infrastructure Financing, e-Commerce, and Healthcare.
Gautam Banerjee, Co-Chair, India-Singapore CEO Forum, Senior Managing Director and Chairman, Blackstone Singapore said, “In January 1994, the then Singapore Prime Minister, Goh Chok Tong, started a ‘mild India fever’ with his visit to India with a group of Singapore businessmen. Since that historical visit not only has bilateral trade and investment between the two countries grown significantly but the level of knowledge, confidence, and desire of businesses from both countries to invest and operate in each other’s territories has grown at a healthy pace. The India-Singapore CEOs Forum will help identify new areas of cooperation, investment and partnership between businesses of both countries.”
The members of India-Singapore CEOs Forum also agreed to work towards resolving regulatory issues and processes affecting bilateral trade and investment between the two countries.
Co-Chairs Neotia and Banerjee presented a Joint Intention document with proposals for collaboration to Piyush Goyal, Minister of Railways and Commerce and Industry, and Mr S Iswaran, Minister for Communications and Information & Minister-in-charge of Trade Relations, Government of Singapore.
Japan strengthening India’s manufacturing sector: Ambassador Suzuki
By Deepak Arora
NEW DELHI, Feb 17: Japanese Ambassador Satoshi Suzuki has said that the Japan-India Global Partnership has culminated in the ‘Special Strategic and Global Partnership’. The convergence between Japan and India is greater than ever and cooperation is expanding in various areas encompassing the political, economic, and cultural spheres.
Addressing the 5th Dialogue with States: Japan’s Connect with Karnataka titled ‘Catalyzing Inclusive Socio-Economic Development’, organized by FICCI Forum of Parliamentarians jointly with the Embassy of Japan, Ambassador Suzuki said that the Japanese government is moving forward in tandem with the Government of India to strengthen India’s manufacturing sector.
“We expect this to help India get better integrated into the regional value chains and to play an even more important role in the global economy. I would like to mention that JETRO (Japan External Trade Organization) is implementing the Program for Strengthening Overseas Supply Chains,” he said.
Regarding the Japan-Karnataka connect, the Ambassador noted that 217 Japanese companies are operating in Karnataka in IT and Japanese start-ups, such as Sagri, an agri-tech venture, and other venture capital firms are supported by the Japan-India Start-up Hub. In addition, trading companies, such as Sojitz and Mitsui, have opened their branches so that they can closely collaborate with those start-ups.
Japanese companies like Panasonic and Sony have set up R&D bases in the state to capitalize on the talent of Indian youths. “We will continue to cooperate with various parties to promote Japanese companies’ operations there. In addition to these exchanges in IT and tourism sectors, I hope that people-to-people exchanges will be promoted by utilizing the ‘Specified Skilled Worker’ scheme,” he added.
Ms Akiko Sugita, Consul-General of Japan in Bengaluru, mentioned that Karnataka is the largest R&D hub of India with the presence of large number of global manufacturing companies. She noted that Japan is ranked the fifth largest investor for FDI for Karnataka from 2014-19 and investment in the state grew 5.4 times from USD 1.3 bn in 2016 to USD 7.2 bn in 2019. The focus sectors being IT, Healthcare and Wellness between Japan and Karnataka.
The aim of the dialogue was to enhance economic cooperation between Karnataka and Japan and to focus on start-up ecosystem, capacity building, art and culture, tourism and people to people ties of Japan’s existing and potential connect with Karnataka.
The discussion also witnessed the presence of Members of Parliament across party lines from Karnataka who shared their views on leveraging the potential of Karnataka in enhancing socio-economic and cultural development and encouraging collaboration on various sectors with Japan.
Dr Ashwathnarayan CN, Deputy Chief Minister of Karnataka, remarked that Japan is one of the largest investors for India. The state of Karnataka offers a suitable investment climate for the Japanese manufacturers both in the long and medium term.
Bhupender Yadav, Chair, FICCI Forum of Parliamentarians and Member of Parliament and National General Secretary BJP, noted that India and Japan have played a pivotal role in overcoming challenges posed by the COVID-19 pandemic. He talked about India’s stance on Atmanirbharta and said that the countries have sought to utilise their combined strengths for diversified and resilient supply chains through the Supply Chain Resilience Initiative between India, Japan, Australia and other like-minded countries.
“Indo- Japanese connect is spread on a larger canvas which includes political, economic, trade and security aspects. The sister state and sister city cooperation have strengthened the connect of Indian states with Japan,” Yadav added.
Gaurav Gupta, Additional Chief Secretary, Commerce and Industry Department, Government of Karnataka, remarked that Karnataka provides innovation and technology with highly skilled workforce and good air connectivity. He talked about the Japan Industrial Township in Tumakuru which has been set up 70 kms from Bangalore with built in infrastructure. He talked about sector specific policies and noted that 25 per cent of capital investment and subsidy on land and infrastructure have been invested by private companies.
GC Chandrashekhar, Member of Parliament, Rajya Sabha, remarked about the need for technical assistance to Clean Ganga project.
Dr Umesh G. Jadhav, Member of Parliament, Lok Sabha, emphasized on the industrial development in the state and noted that it provides a suitable investment climate to Japanese companies.
Dr L. Hanumanthaiah, Member of Parliament, Rajya Sabha, noted that language and literature need to be promoted between Japan and India especially the promotion of Japanese language.
Dr Syed Naseer Hussain, Member of Parliament, Rajya Sabha, opined that Karnataka will be open for investment and socio-cultural understanding and spiritual connect with Japan.
Prof Rajeev Gowda, Former Member of Parliament and Chairman, Congress Research Department, stressed upon the importance of R&D ventures with Japan as well as on infrastructural investments.
Mr KC Ramamurthy, Member of Parliament, Rajya Sabha, noted that Karnataka has immense potential in the tourism sector due to the presence of heritage sites and monuments, which can become a potential sector for cooperation.
Dr Jyotsna Suri, Past President, FICCI; Co- Chair FICCI Forum of Parliamentarians Council and CMD Bharat Hotels noted that the Dialogue with States is a track II collaborative exercise organised in partnership with the Embassy of Japan to deepen the engagement to include Indian states, the Indian heartland.
K Ullas Kamath, Chair, FICCI Karnataka State Council; Joint Managing Director, Jyothy Laboratories Ltd, talked about the sectoral potential of Karnataka and its single- window set up for investors and ease of doing business. He welcomed Japanese investments to Karnataka and noted that the state would make every effort to enhance cooperation to attract FDI from Japanese companies.
Sebi eases IPO norms, paves way for LIC's mega public issue
MUMBAI, Feb 17: Two weeks after the government proposed to amend the LIC Act in the union budget, on Wednesday, following a board meeting the Securities and Exchange Board of India or Sebi altered the country’s public issue norms in a way that will make it easier for India’s largest insurer Life Insurance Corp. of India (LIC) to float its mega initial public offering (IPO).
The government is betting on diluting its stake in state-run LIC via an IPO in the coming fiscal in an attempt to garner enough non-tax revenues to narrow the country’s fiscal deficit.
LIC’s public issue is expected to be the country’s largest-ever and is pegged to be at least ₹1 trillion for just a 10% share sale to the public, said three people directly aware of the insurer’s IPO plans.
Sebi, on Wednesday, eased the minimum public offer (MPO) norms and said that for any company with post issue market capital of above Rs.1 trillion, the IPO size is required to be Rs10,000 crore plus 5% of the incremental market capital amount beyond Rs.1 trillion.
At present, companies with post issue market capital of ₹4,000 crore or more are required to offer at least 10% of the capital to the public in the IPO. Further, such issuers are also required to achieve a minimum public shareholding (MPS) of at least 25% within three years from the date of listing.
The market regulator further relaxed the norms and said that companies with a size of over Rs1 trillion will now be required to achieve at least 10% public shareholding in two years and at least 25% within five years from the date of listing.
This amendment too will particularly help LIC since its size is so large that the market may find it tough to absorb equity papers worth even 5% of LIC in the further public issues that the insurer will need to launch to comply with Sebi’s public shareholding norms post its IPO.
LIC, which is preparing for its IPO and is currently undergoing an evaluation process by actuarial firms, will be the biggest beneficiary of this relaxation by Sebi.
On 1 February, the finance minister, while announcing the budget for fiscal 2022, proposed to amend the LIC Act and bring the rules for LIC under the Companies Act to ensure that the insurer does not face regulatory hurdles while launching its IPO.
LIC, in which the government holds 95%, is the largest insurer in the country with total assets worth over Rs. 34 trillion.
The finance minister said the Central Government will hold at least 75% in LIC for the first five years post the IPO, and subsequently hold at least 51% in the insurer at all times after five years of the proposed IPO.
For the fiscal year 2021, LIC recorded a new business premium of Rs. 1.3 trillion in the April-December period, which is more than double of the total premium collected by all private life insurers together.
A public listing of LIC has been a protracted affair as it required amending the LIC Act. The insurer needed to change its audit and accounting policies; the way it distributes surpluses; and amendments to Sections 24, 28 and 37 of the Act.
Section 24 deals with the way the corporation handles its corpus, Section 28 is about dividend distribution norms and Section 37 provides government guarantee on all its policies.
At present LIC pays 5% of the surplus to the government, while the remaining 95% goes to its policyholders.
In comparison, private insurance companies pay 10% of their surplus to shareholders and the rest goes to policyholders.
Section 24 explains how “the corporation shall have its own fund and all receipts of the corporation shall be credited thereto and all payments of the corporation shall be made therefrom".
LIC’s equity capital stands at Rs.100 crore, which needed to be increased in order to sell even a 10% stake.
On 1 February, the finance minister proposed to increase the authorised share capital of LIC to Rs. 25,000 crore, divided into 2500 crore shares of Rs. 10 each.
The budget also proposed the way LIC’s board will be structured in accordance with the Companies Act.
LIC may make a reservation of up to 10% of the issue size in favour of its life insurance policyholders as one of the reserved categories in the proposed IPO, said the government.
In terms of payment of dividends by LIC, the government said that no dividend should be paid by LIC for any financial year unless such dividends are paid out of the surpluses and profits made by the insurer.
LIC will not be allowed to pay dividend from its reserves unless it is from free reserves.
LIC can have 15 board members of whom at least one has to be a woman director. There can be four managing directors, of which four can be appointed by the government, who will be whole-time directors of LIC post the IPO.
Interest on employee contributions to PF above 2.5 lakh taxable
NEW DELHI, Feb 1: Finance Minister Nirmala Sitharaman, during the Union Budget 2021, on Monday announced a slew of measures including in the health sector, railways, road infrastructure among others.
Poll bound states like West Bengal and Tamil Nadu saw large investment in road and metro infrastructure.
Sitharaman said that the preparation for this budget was like never before, because of Covid-19. "We could not have imagined last year that global economy which was already suffering will have to endure loss of near and dear ones due to pandemic," she said.
Sitharaman said that the government stretched its resources to provide for all walks of society.
This budget is a first of its kind, with Covid-19 restrictions in place. Even the Bahi Khata went digital with Sitharaman carrying a made India tablet, keeping in line with the government's push for Atmanirbhar Bharat.
The finance minister said that there are six pillars of the budget — health and well-being, physical and financial capital, and infra inclusive development, human capital, innovation and R&D, minimum government, maximum governance.
The Finance Minister announced that interest on employee contributions to PF over Rs 2.5 lakhs has now been made taxable. The Budget for the fiscal year beginning April will now make interest on employee contributions to PF above Rs 2.5 lakhs per annum taxable effective April 1, 2021.
In the previous 2020 Budget, the finance minister had capped the tax exemption on employers contribution to PF, NPS and superannuation funds at an aggregate of Rs 7.5 lakh per annum.
Sitharaman also proposed a sharp increase in expenditure on infrastructure, doubling of healthcare spending and raising of the cap on foreign investment in insurance in her Budget for the next fiscal in a bid to pull the economy out of the trough.
The Budget made no changes in personal or corporate tax rates but raised customs duties on certain auto parts, mobile phone components and solar panels in order to provide impetus to domestic manufacturing.
It also imposed an Agriculture Infrastructure and Development Cess (AIDC) on the import of certain items (like apples, peas, lentils, alcohol, chemicals, silver and cotton) to finance agricultural infrastructure and other development expenditure. But its impact on prices has been offset by an equivalent or more reduction in the import duty.
In a relief to senior citizens, those above 75 years of age with only pension and interest income would no longer have to file income tax returns, subject to certain conditions.
Delivering her third straight Budget, Sitharaman allocated Rs 5.54 lakh crore for capital creation in the infrastructure sector. This included Rs 1.18 lakh crore for the roads and highways sector and Rs 1.08 lakh crore for railways. The allocation was 37 per cent more than last year.
The increased spending is aimed at creating demand in the economy and support job creation. With just 1 per cent of GDP being spent on health, she proposed raising of the spending to Rs 2.2 lakh crore next fiscal to help improve health systems as well as fund vaccination drive against coronavirus.
"We decided to spend big on infrastructure in this Budget. We attended to the need of the health sector," she told a press conference after presenting the Budget for 2021-22 in Lok Sabha. "We decided to give greater impetus to the economy in this Budget."
Additional resources required are targeted to be raised through divestment and monetisation. While Rs 1.75 lakh crore is being targeted from the sale of non-strategic public sector companies, the government will get Rs 30,000 crore from the new agri cess.
With government spending more to support the economy during the pandemic that hit revenue collections, the fiscal deficit -- the difference between revenue and expenditure -- for the current year was put at 9.5 per cent of the gross domestic product (GDP) as against a target of 3.5 per cent. For the next fiscal, the fiscal deficit was projected at 6.8 per cent.
"We have spent, we have spent and we have spent. That's why fiscal deficit has reached this number," she said. She also signalled that the fiscal policy support of the economy will continue for at least three years, with the deficit being brought under 4.5 per cent by FY2025-26.
Officials in her ministry at the press conference explained that the new limit for interest-free PF would hit less than 1 per cent of the total EPFO base. For the agriculture sector, she maintained the reform momentum such as the extension of farm credit provision to farmers, commodity expansion under 'Operation Green' and extension of Agriculture Infrastructure Fund (AIF) to APMCs.
In order to incentivise the purchase of an affordable house, the finance minister proposed to extend the period for claiming an additional deduction for the interest of Rs 1.5 lakh paid for home loans by one year to March 31, 2022. To remove hardship faced by NRIs in respect of their income accrued on foreign retirement benefits account due to mismatch in taxation, new rules for alignment will be notified.
Foreign direct investment (FDI) limit in insurance was proposed to be raised to 74 per cent from the current 49 per cent.
Also, a tax deducted at source (TDS) of 0.1 per cent will be levied on the purchase of goods exceeding Rs 50 lakh in a year. The responsibility of deduction shall lie only on persons whose turnover exceeds Rs 10 crore. Reduction in customs duties on gold and silver should bring some relief to the consumers while the hike in import duty on certain iron and steel products may adversely affect the real estate and infrastructure sector.
An agri cess of Rs 2.5 per litre on petrol and Rs 4 per litre on diesel was also slapped but this was offset by a reduction of an equivalent amount in the excise duty -- making it price neutral for consumers. Tax filing simplification for investors through pre-filled capital gains and interest income and a reduction in the limit for tax assessment reopening from six to three years will improve taxpayer confidence.
The policy on rationalisation of customs rates and procedures which started a few years back has been further moved ahead this year with a plan to review over 400 customs exemptions and a policy of having future exemptions with a validity period of two years. The government capital expenditure as a proportion of GDP is set to pick up from 1.7 per cent in FY20 to 2.3 per cent in FY21 and further to 2.5 per cent in FY22, which will be a 17-year high figure and will enhance medium-term growth prospects.
To address concerns around asset quality, credit loss and liquidity stress, this Budget proposed to infuse additional capital of Rs 20,000 crore into PSU banks for providing continued credit access to wholesale and retail borrowers. On the new cess, Finance Secretary Ajay Bhushan Pandey said, "We have imposed agri cess on about 14-15 items. The total amount that we estimate (to get) is Rs 30,000 crore."
Customs duty on cotton, silk, maize bran, certain gems and jewellery, specified auto parts, screws and nuts was hiked.
To promote value addition in the electronics sector, the same was raised for printed circuit board assembly, wires and cables, solar inverters and solar lamps. The import duty on naphtha, iron and steel melting scrap, aircraft components, gold and silver was reduced.
Finance Minister Announces Voluntary Vehicle Scrapping Policy
NEW DELHI, Feb 1: Finance Minister Nirmala Sitharaman on Monday announced the much-awaited voluntary vehicle scrapping policy to phase out old and polluting vehicles.
Presenting the Budget for 2021-22 in Parliament, Ms Sitharaman said that under voluntary vehicle scrapping policy, personal vehicles would undergo fitness test after 20 years while commercial vehicles would require it after completion of 15 years.
Welcoming the policy, Road Transport, Highways and MSMEs Minister Nitin Gadkari said the policy will lead to new investment of around ₹ 10,000 crore and create as many as 50,000 jobs.
He further said the policy would cover over 1 crore light, medium and heavy motor vehicles.
"The policy would cover an estimated 51 lakh light motor vehicles (LMVs) that are above 20 years of age, while another 34 lakh LMVs are above 15 years. It would also cover 17 lakh medium and heavy motor vehicles, which are above 15 years, and currently without valid fitness certificates," Gadkari said.
These vehicles are estimated to cause 10-12 times more pollution than the latest vehicles, he said.
Outlining the benefits of the policy, Gadkari said it would lead to recycling of waste metal, improved safety, reduction in air pollution, lower oil imports due to greater fuel efficiency of current vehicles, and stimulate investment.
He said the finer details of the policy will be unveiled within 15 days.
During her speech, Sitharaman said that details of the scheme will be separately shared by the Road Transport and Highways Ministry.
"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.
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, she added.
On July 26, 2019, the government had proposed amendments to motor vehicle norms to allow scrapping of vehicles older than 15 years in a bid to spur adoption of electrical vehicles.
"We have submitted the proposal and I am expecting that we will get approval as early as possible for the scrapping policy," Gadkari had said on January 15.
The minister had also said that once the policy is approved, India will become an automobile hub and there will also be reduction in the prices of automobiles.
He had said recycled material from old vehicles will help reduce the prices, adding that the automobile industry's turnover, which is ₹ 4.5 lakh crore with ₹ 1.45 lakh crore exports, will get a boost.
In May 2016, the government had floated a draft Voluntary Vehicle Fleet Modernisation Programme (V-VMP) that proposed to take 28 million decade-old vehicles off the road.