Cabinet Approves ₹9,585 Crore Scheme to Replace Old Trucks and Buses in Delhi-NCR

Key Highlights

• ₹9,585 crore scheme launched to replace old trucks and buses in Delhi-NCR.

• BS-IV and older vehicle owners can switch to BS-VI or electric vehicles.

• Buyers will get 5% loan interest subsidy and fuel vouchers up to ₹4,800 monthly.

• Vehicle manufacturers to offer around 8% discount on eligible new vehicles.

• Scheme targets over 1.9 lakh trucks and 16,000 buses to reduce pollution.

In a major step to reduce air pollution in the Delhi-National Capital Region (NCR), the Central Government has approved a ₹9,585 crore scheme aimed at replacing old trucks and buses with cleaner BS-VI and electric vehicles (EVs). The initiative is expected to modernize the region’s commercial vehicle fleet and promote cleaner transportation technologies.

Scheme Aims to Reduce Vehicle Pollution in Delhi-NCR

The newly announced programme targets commercial vehicles operating in Delhi-NCR that fall under BS-IV and older emission categories. According to the government, older diesel trucks and buses are among the major contributors to air pollution in the region.

Vehicles complying with BS-I to BS-IV emission standards emit nearly 67% more carbon monoxide and 97% more particulate matter compared to BS-VI vehicles. The scheme is designed to accelerate the replacement of these ageing vehicles and improve air quality across the NCR.

Total Financial Outlay of ₹9,585 Crore

The total financial commitment under the scheme stands at ₹9,585 crore.

Out of this amount:

• ₹5,041 crore will be provided by the Central Government.

• Around ₹1,601 crore will come through tax concessions offered by participating state governments.

• Additional support will be provided through incentives from vehicle manufacturers and other stakeholders.

The scheme will remain open for enrolment for two years, while several benefits will continue for five years after the registration of the replacement vehicle.

Who Can Avail the Benefits?

Owners of BS-IV and older trucks and buses registered in Delhi-NCR will be eligible for the scheme if they replace their existing vehicles with:

• BS-VI compliant vehicles, or

• Vehicles meeting stricter emission norms, or

• Electric vehicles registered within the NCR.

The government estimates that the programme will cover more than 1.9 lakh trucks and around 16,000 buses currently operating in the region.

Attractive Incentives for Vehicle Owners

To encourage fleet owners to shift to cleaner vehicles, the government has introduced a comprehensive financial support package.

5% Interest Subvention on Vehicle Loans

Eligible buyers will receive a 5% interest subsidy on vehicle loans for a period of five years, reducing the overall cost of purchasing a new vehicle.

Monthly Fuel Vouchers

Oil Marketing Companies (OMCs) will provide monthly fuel vouchers worth up to ₹4,800, depending on the vehicle category. These vouchers will also be available for five years from the date of registration of the replacement vehicle.

Benefits for Electric Vehicle Buyers

Owners purchasing electric vehicles will be eligible for lump-sum incentives. Similar benefits may also be available through Certificate of Deposit trading mechanisms.

OEM Discounts

Participating vehicle manufacturers will offer approximately 8% discount on the ex-showroom price of eligible replacement vehicles, further lowering acquisition costs.

Rules for Scrapping and Vehicle Disposal

The scheme includes specific conditions regarding old vehicle disposal.

• BS-III and older vehicles must be scrapped at a registered Vehicle Scrapping Facility (RVSF).

• Owners of BS-IV vehicles can either scrap their vehicles or sell them outside the NCR in non-NCAP cities and towns before purchasing a replacement vehicle.

These measures are intended to ensure that older polluting vehicles are gradually removed from the NCR region.

Special Provisions for Delhi

The scheme includes additional requirements for vehicles registered in Delhi.

• Light Goods Vehicles (LGVs) purchased under the programme must be electric.

• Buses will qualify only if they are BS-VI CNG-powered or fully electric.

Government-owned vehicles will not be eligible for benefits under the scheme.

Tax and Registration Fee Concessions

The Centre has urged participating state governments to provide:

• 100% concession on motor vehicle tax for new replacement vehicles.

• Complete waiver of registration fees for eligible vehicles.

For used BS-VI vehicles purchased under the scheme, owners will receive a 50% concession. These tax-related benefits will remain valid for up to 10 years.

Digital Implementation and Monitoring

The programme will be implemented jointly by the Ministry of Road Transport and Highways (MoRTH), the National Capital Region Planning Board (NCRPB), and the governments of Delhi, Haryana, Uttar Pradesh, and Rajasthan.

A fully digital integrated portal will manage the scheme. The platform will enable:

• Real-time eligibility verification

• Automated interest subsidy claims

• Monthly fuel voucher credits

• Tracking and monitoring of pollution reduction outcomes

This digital approach is expected to simplify the application process and improve transparency.

Cleaner Transport for a Better Future

Announcing the initiative, Information and Broadcasting Minister Ashwini Vaishnaw said the scheme will target over 1.9 lakh trucks and approximately 16,000 buses operating in Delhi-NCR under older emission categories.

Delhi-NCR continues to face some of India's highest pollution levels, especially during winter. Authorities have introduced several measures over the years to reduce emissions from transport, construction, and industrial activities. The new vehicle replacement scheme is expected to play a significant role in improving air quality while supporting the adoption of cleaner technologies such as electric trucks and buses.

Also Read: JBM Auto Dominates India's Electric Bus Market with 49% Share in May 2026

CMV360 Says

The ₹9,585 crore vehicle replacement scheme marks one of the largest clean transport initiatives for Delhi-NCR. By offering interest subsidies, fuel vouchers, tax benefits, EV incentives, and manufacturer discounts, the government aims to accelerate the transition from older polluting commercial vehicles to cleaner BS-VI and electric alternatives. The programme is expected to reduce vehicular emissions, improve air quality, and create a more sustainable commercial transport ecosystem across the region.