Modi govt’s new project: Vehicles at 40% cheaper price for rural entrepreneurs | india | Hindustan Times
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Modi govt’s new project: Vehicles at 40% cheaper price for rural entrepreneurs

Rural entrepreneurs can now buy passenger vehicles at a 40% cheaper price under the Narendra Modi government’s proposed transportation scheme aimed to connect the country’s vast hinterlands seamlessly.

Modi Govt Two Years Updated: May 28, 2016 09:21 IST
HT Correspondent
In his budget speech this year, finance minister Arun Jaitley had said that the government would enact necessary amendments in the Motor Vehicles Act and open up the road transport sector in the passenger segment.
In his budget speech this year, finance minister Arun Jaitley had said that the government would enact necessary amendments in the Motor Vehicles Act and open up the road transport sector in the passenger segment. (Arvind Yadav/HT file )

Rural entrepreneurs can now buy passenger vehicles at a 40% cheaper price under the Narendra Modi government’s proposed transportation scheme aimed to connect the country’s vast hinterlands seamlessly.

The prices of popular vehicles in rural service range from Rs 2.5 lakh to Rs 4.5 lakh. A subsidy of 40% on a Rs 2.5 lakh vehicle would mean that the ex-showroom price will come down by Rs 1 lakh.

The government will launch the pilot project amid expectations that the Pradhan Mantri Gramin Parivahan Yojna (PMGPY) will not only provide cheaper and safer transport but also employment for the locals.

Women self-help groups, rural Dalits and tribals belonging to Below Poverty Line (BPL) families will be the government’s key choice to run the services.

The state governments will implement the scheme while the Centre will frame guidelines and rules.

Read: After Gram Sadak Yojna, Centre’s new scheme to focus on rural transport

“After several rounds of discussions, we have decided to give a one-time subsidy as a viability-gap-funding for the vehicles. A 40% subsidy, keeping in mind the normal swing in fuel costs, can keep the cost of running the vehicle at Rs 1/km,” said a senior rural development ministry official.

The Centre may reimburse the subsidy to the beneficiary through the aadhar-linked system after the vehicle is bought.The remaining amount can be loaned from the banks.

As the government wants to give the highly disorganised rural transport sector some shape and regulation, it has identified 11 vehicles, including, Maruti Eeco, Mahindra Maxximo and Supro and Tata Magic, which will attract its financial support

“Even an e-rickshaw can get a subsidy. The choice of vehicle will depend on the owner on the basis of the local requirements. Priority will be given to women self-help groups, Dalit or tribal villagers,” said the official.

In his budget speech this year, finance minister Arun Jaitley had said, “The government will enact necessary amendments in the Motor Vehicles Act and open up the road transport sector in the passenger segment.”

Hailing the scheme as a “game-changer”, Jaitley had said that the scheme would lead to “more efficient public transport facilities, greater public convenience, new investment in this moribund sector, creation of new jobs for youth, growth of start-up entrepreneurs and other multiplier effects.”

After spending thousands of crores of rupees every year on rural roads, the Centre wants their better capacity utilisation. The scheme can also generate skill development and shift the focus from MGNREGA as the main source of livelihood in distress.