Mahindra, MSTC join to build India's first automobile shredding plant

Mahindra Intertrade Ltd, a unit of automobile, technology and services group Mahindra and Mahindra, has signed a memorandum of understanding (MoU) with MSTC Ltd, a Government of India enterprise (formerly known as Metal Scrap Trading Corporation Limited), for setting up India's first auto shredding facility.

The proposed facility will be equipped with state-of-the-art, fully automated end-of-life vehicle recycling equipment and will be India's first such facility, a statement from MSTC said, adding the joint venture would go a long way in the efficient recycling of scrapped automobiles.

''MSTC is always looking at innovative ways to recycle scrap and protect the environment and this facility will help to participate in the emission targets which India has promised to fulfil via the COP 21 Emission Treaty,'' S K Tripathi, chairman and managing director of MSTC Ltd, said.

''The concept of vehicle scrappage is still new to India as compared to the West where it is a lucrative industry. While the number of cars has increased substantially over the last two decades, there is no recycling or scrapping provision in place to deal with old and discarded vehicles. Recycling, if done correctly, is not only environment friendly but will also help keep older vehicles off the streets. We are delighted to have MSTC Ltd. partner with us in this project which presents so much potential,'' said Zhooben Bhiwandiwala, managing partner, Mahindra Partners.

Sumit Issar, managing director of Mahindra Intertrade Ltd, said, "Our study indicated that recycling not only saves energy costs but also minimises the need for other resources as every tonne of new steel manufactured from scrap steel saves a substantial amount of iron ore, coal and limestone. Moreover, if India focuses on scrapping old automobiles, it can recover significant amounts of steel scrap, aluminium scrap, plastic and rubber. Hence, there is a pressing need for facilities such as this one.''

The joint venture hopes the new stricter norms related to road worthiness of automobiles to generate huge business as a huge number of vehicles are expected to come under the end-of-life category in India.

This initiative will not only revolutionise the way automotive scrap is generated and procured in India, but will also help reduce dependence on imports, providing steel mills with a one-stop solution for all their metal scrap related needs, the release added.

Auto-shredding in India is largely an unorganized activity with vehicles long past their usable life still in use, especially in rural and semi-urban India. Older vehicles are currently dismantled in an unscientific manner, which is hazardous to the environment. The extent to which the vehicle is recycled is also very minimal, with most vehicular residue making its way into landfills.

MSTC Limited, a mini ratna category-I public sector enterprise under the administrative control of the ministry of steel, acts as a regulating authority for export of ferrous scrap.