The markets cheered the announcements made by finance minister Nirmala Sitharaman; the voluntary scrapping of vehicles got thumbs up Sensex and Nifty.
After Sitharaman's announcement, Sensex jumped 850 points and auto stocks gained.
Sitharaman said that under voluntary vehicle scrapping policy, personal vehicles would undergo fitness test after 20 years while commercial vehicles would require it after completion of 15 years.
She said this will promote fuel-efficient and environment friendly vehicles while cutting on India's huge import bills.
Sitharaman said that the ministry of road transport and highways will announce the finer details of the policy.
The shares in Indian markets were already high ahead of the budget presentation.
As she presented the budget for financial year beginnign April 1, Sitharaman unveiled several measures to bolster the economy following the impact of the Covid-19 pandemic.