In India, recycling of end-of-life vehicles (ELVs) is in a quandary, with only three percent of eligible vehicles scrapped between 2022 and 2025, according to NITI Aayog, a public policy advisory body, on Tuesday, June 16.
According to the organization, about 12 million vehicles were classified as ELVs during this period, but only 350,000 units were disposed of at registered vehicle recycling facilities.
For a country of the automotive scale of India, this is not a minor implementation issue. This is a structural challenge for the entire ELV value chain, NITI Aayog said.
India's ELV fleet is expected to grow from about 23 million vehicles in 2025 to nearly 50 million by 2030. This growth poses a serious environmental problem, especially where older, higher-emitting vehicles remain in circulation or are dismantled outside of regulated systems. But it also represents a significant resource opportunity for steel, aluminum, copper, plastics, reusable parts and future battery-related materials. The problem is that policy intentions and market behavior are not yet aligned, the advisory body said.
It said India's formal recycling infrastructure remains limited and there are gaps in both automated testing stations and registered vehicle recycling facilities, with facilities unevenly distributed across the country.
Access is important for vehicle owners, and if the route is allowed is remote, slow or poorly understood, the unofficial route becomes the easier option. Price is another deciding factor. Informal dismantlers can often offer more for vehicles because they operate with lower compliance costs, limited environmental guarantees and fewer tax or documentation obligations.
For the owner of an old car or commercial vehicle, the choice may be simple: accept a higher immediate payment from an informal buyer or use a formal system, which may be better for the environment but less attractive financially. This is the main task. A circular economy cannot be built on regulation alone. It must work on a commercial basis for the recycler, the vehicle owner, the original manufacturer
