Iran has ambitious plans to increase tenfold a credit-scheme for scrapping old cars to clean up its polluted cities and reduce expensive petrol imports, an official said on Saturday. The government is setting aside more than $300 million to pay for the programme over the next six months, an official said.
Any moves to curb imports into gas-guzzling Iran, where petrol is cheaper than mineral water, are closely watched by European and Asian traders.
Schemes to encourage Iranian motorists to trade in their rusty fuel-hungry cars, many of which are close to 30 years old, have been in place for at least five years.
Youssef Hojjat, a senior official at the Environmental Safeguards Organisation, said about 20,000 cars were scrapped under a credit-scheme in the year to March 2005.
"Currently we have only one scrapping centre. This will be increased to five. Each centre has a capacity of 200 cars so full capacity will be 1,000 a day," he told Reuters.
He said this should mean Iran would be able to scrap some 200,000 cars per year. The timing remained vague but he hoped the five centres should be working in the next six to 10 months.
Motorists who scrap their cars are given a credit of about $1,700 as a discount on new car. The carmakers recoup this money as a discount on tariffs on materials they import.
Hojjat said the government would put an allocation of $333 million towards cutting these tariffs on parts over the next six months.
Although Iran has the world's second biggest reserves of crude oil, it lacks refining capacity and has to import about 25 million litres of the 60 million litres burned each day.
Analysts doubt cutting down on inefficient old cars can do much to break the gasoline habit when petrol fetches a little over $0.10 cents per litre at the pumps.
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