Delhi EV Policy 2.0: Scrappage-Linked Subsidies Replace Upfront Discounts with ₹200 Crore Push

What Changed: From Upfront Subsidies to Scrappage-Linked Incentives

The original Delhi EV Policy, launched in August 2020, was widely regarded as one of India's most progressive state-level electric vehicle programmes. It offered a flat subsidy of up to Rs 1.5 lakh on electric cars and Rs 30,000 on electric two-wheelers, paid directly to the dealer at the point of sale. The buyer walked out of the showroom paying less, with zero paperwork on their end. It was simple, effective, and helped Delhi register over 90,000 electric vehicles by the end of 2025.

But the simplicity came with problems. The upfront subsidy model drained the treasury quickly without ensuring that old polluting vehicles were actually being replaced. Many buyers were adding EVs as second or third vehicles while their old BS-III and BS-IV cars continued to ply on Delhi's congested roads. The pollution reduction impact was diluted because the net number of vehicles on the road kept increasing rather than being replaced.

EV Policy 2.0 addresses this head-on. The entire Rs 200 crore allocation is now channelled through a scrappage-linked mechanism. To claim the EV purchase incentive, buyers must first scrap a BS-IV or older vehicle registered in Delhi at an authorised Registered Vehicle Scrapping Facility (RVSF). The Certificate of Deposit from the RVSF, combined with the new EV purchase invoice, triggers the incentive disbursement directly into the buyer's Aadhaar-linked bank account within one week.

Old Policy vs New Policy 2.0: Side-by-Side Comparison

The table below summarises the key differences between the original Delhi EV Policy and the new EV Policy 2.0, so you can understand exactly what has changed and how it affects you as a buyer or seller.

Subsidy Amounts by Vehicle Type

The incentive amounts under EV Policy 2.0 vary by the type of electric vehicle purchased and the category of old vehicle being scrapped. Here is the detailed breakdown that Delhi has announced.

How to Claim the Scrappage-Linked EV Subsidy

The Delhi government has designed a streamlined claim process that eliminates the dealer as an intermediary. Here is the step-by-step process for a car buyer looking to claim the maximum Rs 1.5 lakh incentive.

Charging Infrastructure: 18,000 Stations by End-2026

Perhaps the most impactful provision of EV Policy 2.0 for everyday EV owners is the aggressive charging infrastructure mandate. Delhi currently has approximately 3,200 public charging stations, a number that has grown steadily but remains insufficient for the capital's growing EV fleet of over 90,000 registered electric vehicles.

The new policy sets a target of 18,000 public charging stations operational by December 2026. To achieve this, the government has introduced a dealership charging mandate: every automobile dealership in Delhi, regardless of whether it sells EVs, must install at least one public EV charger on its premises. This is not optional. Dealerships that fail to comply risk having their trade licences suspended.

The logic behind the dealership mandate is practical. Dealerships are already spread across every part of the city, they have existing electrical infrastructure, dedicated parking space, and staff to manage the chargers. By converting every dealership into a charging point, Delhi creates a distributed network without needing to build new infrastructure from scratch.

Beyond dealerships, the policy provides subsidies for residential welfare associations and commercial complexes that install public chargers. Group housing societies with more than 100 units can claim up to Rs 2 lakh per charger installation, covering roughly 40 to 50 percent of the cost. Shopping malls and office complexes get similar incentives tied to the number of parking spots equipped with charging capability.

What This Means for Used Car Buyers and Sellers

Delhi EV Policy 2.0 will reshape the used car market across the Delhi-NCR region in several significant ways. Whether you are buying, selling, or holding onto a vehicle, understanding these dynamics will help you make better financial decisions over the next 12 to 18 months.

BS-IV and older vehicles will depreciate faster. The scrappage-linked subsidy creates a direct financial incentive for owners of BS-IV and older cars to scrap rather than sell. A BS-IV Maruti Swift that might fetch Rs 2.5 lakh in the used car market could be worth more as scrap when you factor in the Rs 1.5 lakh EV subsidy, the scrap material value (Rs 15,000 to Rs 25,000), and the road tax rebate on the new vehicle. This means fewer buyers will be interested in purchasing very old vehicles, pushing their resale values down by an estimated 15 to 25 percent over the next year.

BS-VI used cars become more valuable. As older vehicles exit the market through scrappage, demand will shift to newer used cars in the 3 to 6 year age bracket. BS-VI vehicles manufactured from April 2020 onward are well positioned because they face zero risk of emission-related restrictions, have modern safety features, and are perceived as the safe buy for anyone not yet ready to go electric. Expect resale values for popular BS-VI models like the Hyundai Creta, Maruti Swift, and Tata Nexon to hold firm or even appreciate slightly in the Delhi market.

The sub-Rs 3 Lakh used car segment will shrink. Delhi's budget used car market, dominated by 12 to 18 year old vehicles, will contract as scrappage incentives pull these cars out of circulation. Buyers who previously relied on this segment for affordable transportation will need to either stretch their budgets to Rs 4 to 6 lakh for a newer used car, or consider the growing market for used electric two-wheelers as an alternative.

Sellers in Noida, Gurugram, and Faridabad should act quickly. While EV Policy 2.0 is technically a Delhi government initiative, its ripple effects extend across NCR. Buyers in satellite cities will compare the scrappage-plus-EV-subsidy package against buying a used car, making it harder to sell older vehicles at current prices. If you own a BS-IV or older vehicle registered in any NCR city and are considering selling, listing it sooner rather than later on VahanBazaar will help you capture value before the market adjusts.

Who Benefits Most from Delhi EV Policy 2.0?

The policy is designed to create winners across multiple stakeholder groups, but some benefit more than others. Here is a practical breakdown.

Challenges and Criticisms of the New Model

While EV Policy 2.0 is an improvement in targeting, it is not without criticism. Consumer advocacy groups have raised several concerns that prospective buyers should be aware of.

The most significant criticism is that the scrappage requirement creates a barrier for first-time car buyers and those who do not own a BS-IV or older vehicle. Under the old policy, anyone buying an EV got the subsidy regardless of their vehicle ownership history. Now, a young professional buying their first car, who is exactly the demographic most likely to choose electric, gets zero incentive unless they can find a family member's old vehicle to scrap.

There are also logistical concerns. Delhi currently has only 12 operational RVSFs, and processing capacity is limited. If the government's target of 40,000 to 60,000 annual scrappages materialises, these facilities would need to handle roughly 150 to 200 vehicles per day across all locations. Delays at the scrapping stage could hold up the entire subsidy disbursement chain, frustrating buyers who have already committed to purchasing an EV.

The Rs 25 lakh ex-showroom price cap on eligible electric cars excludes most premium EVs. Models like the BYD Atto 3, Hyundai Ioniq 5, and the higher variants of the Tata Harrier EV fall above this threshold, limiting the subsidy to budget and mid-range electric vehicles. While this is arguably progressive in targeting mass adoption over premium purchases, it does reduce choice for buyers who would have gone electric regardless.

What Delhi-NCR Car Owners Should Do Right Now

Whether you are a potential EV buyer or a used car seller, here are the actionable steps you should take in light of Delhi EV Policy 2.0.

If you are selling a 3 to 8 year old car in Delhi-NCR: Your vehicle is in the sweet spot. List it on VahanBazaar now to capture the rising demand from buyers who are being priced out of the sub-Rs 3 lakh segment as older cars get scrapped. Make sure your listing highlights the BS-VI emission standard, service history, and valid insurance to command the best price.

If you are buying a used car in Delhi: Avoid BS-IV and older vehicles unless the price is exceptionally low and you plan to use the car for less than 2 to 3 years. These vehicles will face increasing difficulty at resale as more buyers opt for the scrappage-plus-EV route. Focus your search on used cars in Delhi from 2020 onward (BS-VI era) for the best long-term value retention.

If you are in Noida, Gurugram, or Ghaziabad: Watch for similar policy announcements from the Uttar Pradesh and Haryana state governments. Delhi's policy often serves as a template for surrounding states. In the meantime, the market effects of Delhi's scrappage incentive will spill over into NCR used car prices regardless of your state's policy.