Mahindra Intertrade and the Government of India have worked on creating a joint venture named “Mahindra MSTC Recycling” to start the first automobile scrapping plant in India. The auto scrapping plant will have a capacity of 100,000 tons per annum and will reduce pollution on the roads by eliminating old heavy commercial vehicles that cause pollution. Financial incentives worth about INR150,000 will be provided to the owners of vehicles older than 10 years to encourage them to get their vehicles scrapped. This will not only address pollution but also road safety concerns in the country.
The major challenge for the scrapping plant is convincing people to recycle old vehicles, duly collecting and transporting them to the dismantling facilities. The auto-scrapping program aims to set up about 8-10 units near Kandla port in Gujarat that will also accept imported, old vehicles to be scrapped and boost employment in the country. This will increase the amount of raw material in the country for producing new vehicles and will relieve India of some of the imports required for automobile production. The government has anticipated this policy will boost the current turnover of the automobile industry by four times over the next 4-5 years.
The materials would then undergo a major segregation process to metals, non-metals, rubber and other materials. These segregated materials undergo a predefined recycling method. The shredding plant will be the first of its kind, which will reduce the foreign exchange outgo from the country by eliminating imports by 5-6 million tons. It will also help to domestically source raw material for the secondary steel sector.