New Delhi, Aug 8 (IANS) Mahindra Group firm Mahindra Intertrade on Monday entered into a joint venture agreement with state-owned MSTC to set up India's first greenfield auto shredding and recycling facility.

"India does not have any modern auto shredding plant as of now. MSTC-MIL will have a good partnership going ahead," MSTC Chairman and Managing Director B.B. Singh said in a statement.

"We are sure of setting up a world class facility which will go a long way in recycling of ELVs (end-of-life vehicles) and reduce dependence on mining iron ore and other resources."

Singh further said that the new venture will aide in saving of foreign currency, as a result of import substitution of scrap and would also contribute to India's COP21 commitments.

Zhooben Bhiwandiwala, Managing Partner with Mahindra Partners said: "We are very encouraged by the support we have received from both the central and state governments through appropriate policy announcements."

According to the statement, India's first auto shredding facility will establish an integrated automotive recycling capability for ELVs - from collection, compaction, transportation, depollution, dismantling, shredding, recycling, and disposal.

"This JV is a significant first-step towards ensuring that ELVs are recycled in a sustainably responsible manner, with the aim of 100% recycling of all materials," the statement said.

"State-of-the-art, high-tech shredding and sorting equipment to meet global standards will ensure that the scrappage of vehicles is carried out in an environment friendly manner as per guidelines released by the MoEFC (Ministry of Environment, Forest and Climate Change) and CPCB (Central Pollution Control Board)."

The statement disclosed that Gujarat and Maharashtra have been shortlisted as probable locations for the first integrated facility. The facility is expected to commence full operations by early 2018.

"It is anticipated that this JV will establish its presence across the country to tap into the large reservoir of ELVs, while initially establishing its mother facility in either Gujarat or Maharashtra," cited the statement.

The statement added that a huge number of vehicles are expected to come under the end-of-life category in India due to the new strict norms related to road worthiness of automobiles and recent NGT (National Green Tribunal) guidelines.