Mahindra Inter-trade today signed a joint venture agreement with MSTC to set up the country’s first auto shredding and vehicle recycling unit.
Gujarat and Maharastra have been short listed for setting up the facility, which will commence operations by early 2018.
B B Singh, chairman and managing director, MSTC said, “India does not have any modern auto shredding plant as of now.We are sure of setting up a world class facility which will go a long way in recycling end of life vehicles and reduce dependence on mining iron ore and other resources.”
Apart from saving on Forex as a result of import substitution of scrap, this JV would also contribute to India’s COP21 commitments
Vehicle Scrappage Policy Under Consideration
Scrappage Policy for end of life vehicles is under active consideration by the Government of India which will ensure steady availability of raw materials for the plant.
It will reduce the dependence on present annual import of scrap of 5-6 million tonnes of Shredded Scrap in the Country, consequently reduce the foreign exchange outgo. In addition, the auto grade steel of vehicles will be recycled into a similar grade of steel as against making lower grade steel by unorganized sector.
As per the ‘Scrappage Policy’ of Government of India, a scheme of incentive’s shredding of Motor vehicles in the form of subsidy/ excise duty relief and additional discounts by vehicles manufacturer will help raw material security for the plant. This may be in line with ‘Cash for Clunkers’ which is in vogue in several countries in Europe and USA.
The main shredding plant will shred the ELV and white goods and separate the ferrous components via magnetic separation. The rest of the output from the main shredding plant is processed through the ‘eddy current’separator for non- ferrous material to yield two mixtures of non- ferrous metals called Zorba (which is predominantly aluminum) and Zurik (which is predominantly Stainless Steel) in addition to the main output as shredded scrap.
Auto Recycling a High Potential Business in India
Auto recycling is a high potential business opportunity in India. Thanks to the government’s initiative to introduce better policies for organised and scientific car recycling, India has potential to become one of largest car recycling regions.
Around 30 million cars are recycled every year and India could initially bring in 3-4 million cars and numbers will grow gradually.
Inputs from Economic Times
Selling Scrap ex Heavy Equipment