Andhra Pradesh Tops Ease of Vehicle Ownership Index 2026, Uttar Pradesh Ranks Last

Why in news?

Andhra Pradesh has secured the first position in India's Ease of Vehicle Ownership Index (EVOI) 2026, while Uttar Pradesh has ranked last among the 15 states and Union Territories assessed.

Key facts 

What is the Ease of Vehicle Ownership Index (EVOI)?

• The Ease of Vehicle Ownership Index is a comparative assessment that evaluates how efficiently Indian states facilitate the transfer of ownership of pre-owned vehicles.
• When someone sells a second-hand car or motorcycle, its legal ownership must be transferred from the seller to the buyer through the Regional Transport Office (RTO) system.
• However, this process may involve documentation, verification, payment of fees, loan clearance and multiple visits to government offices.
• Different states follow different procedures, resulting in variations in processing time, cost and convenience.

Who released the index?

State-wise Rankings in EVOI 2026

Six Major Parameters of the Index

Why did Andhra Pradesh rank first?

• Andhra Pradesh secured the highest score of 5.91 because of its comparatively efficient ownership transfer procedures and stronger digital systems.
• Major strengths include:
  • Faster RC transfers: Ownership transfers generally take around 7–10 days.
  • Biometric verification: Authentication of the buyer, seller and lender helps streamline verification.
  • Digital infrastructure: Better use of digital systems reduces procedural difficulties.
  • Road tax refunds: The state has a functioning mechanism for refunding road tax when vehicles move outside its jurisdiction.

Why did Uttar Pradesh rank last?

• Uttar Pradesh secured the lowest position with a score of 2.47.
• Major challenges include:
  • Long processing time: Vehicle ownership transfers can take more than 30 days.
  • Administrative complexity: Citizens may need repeated visits to RTO offices.
  • Incomplete digitisation: Online applications may still require physical document submission.
  • Unpredictable costs: Additional procedural expenses can increase the financial burden.
  • Regulatory hurdles: Complicated procedures affect consumers and used-vehicle dealers.

Andhra Pradesh vs Uttar Pradesh

What is a Registration Certificate (RC)?

• A Registration Certificate (RC) is an official document issued by the Regional Transport Office that establishes the registration details of a motor vehicle.
• It contains information such as vehicle registration number, owner's name, vehicle make and model, chassis number, engine number and fuel type.

Why is RC transfer important?

• Suppose a person sells a second-hand car to another individual. Even after receiving payment and handing over the vehicle, the seller's name may continue to appear in official registration records until the ownership transfer is completed.
• This can create complications involving traffic challans, legal notices, accident-related liabilities, insurance and vehicle records.

What is VAHAN?

• VAHAN is a digital platform developed under the Ministry of Road Transport and Highways (MoRTH) for vehicle registration-related services.
• Its major functions include:

What is Hypothecation?

• Hypothecation is a legal arrangement in which a vehicle purchased through a loan serves as security for the lender until the loan is repaid.
• For example:
  • A person purchases a car using a bank loan.
  • The bank finances the purchase.
  • The vehicle remains in the borrower's possession.
  • The lender's interest is recorded in the vehicle registration documents.
• After repayment of the loan, hypothecation must be formally removed from the RTO records.
• If this is not completed, transferring the vehicle to a new owner can become complicated.
• The EVOI report highlights the need for better integration between banks and transport departments to automate this process. 

Major Findings of the Report

• Reported pending RC transfers even after completing vehicle sales: 39%
• Completed ownership transfer within two weeks: 9.6%
• Could not accurately estimate total transfer costs: 63%
• Were unaware of party-peshi requirements until reaching the RTO: 61.5%
• All surveyed respondents reported relying on intermediaries or agents to complete ownership transfers.
• Around 28.1% of sellers reported receiving traffic challans or legal notices even after handing over their vehicles.
• In 13 of the 15 states, applicants submitting online requests were still required to deliver physical documents to the RTO.
• Actual transfer expenses can reach nearly ten times the prescribed statutory fee.

What is the Deemed Ownership Framework?

• The Deemed Ownership Framework was introduced through amendments to the Central Motor Vehicles Rules in 2022.
• It allows authorised dealers to be recognised as deemed owners of pre-owned vehicles held in their inventory, subject to prescribed conditions.
• Suppose a person sells a second-hand car to an authorised dealer.
• Under the conventional system, the vehicle may remain registered in the original owner's name while the dealer holds it for resale.
• Under the deemed ownership framework:
  • An eligible dealer is registered under the prescribed system.
  • The dealer takes custody of the vehicle.
  • The dealer is recognised as the deemed owner for the relevant legal and regulatory purposes.
  • This helps protect the previous owner from certain liabilities during the dealer's inventory period.

India's Growing Pre-Owned Vehicle Market

• India's second-hand vehicle market is expanding rapidly and has become an important part of the automobile economy.
• According to the EVOI report, the market is projected to grow from $36.4 billion in 2025 to $73.5 billion by 2030.

Government Framework Related to Vehicle Ownership

What is the idea of One Bharat, One Road Tax?

• It is a proposed policy vision aimed at reducing differences in road tax structures across states and simplifying interstate vehicle movement.
• It is not an existing nationwide uniform road tax system.
• Potential benefits include:
  • Easier interstate vehicle transfers.
  • Reduced taxation complexities.
  • Better resale opportunities.
  • Greater integration of the national automobile market.

Significance of the Index

• Ease of Doing Business: Reduces administrative difficulties for consumers and dealerships.
• Consumer Protection: Helps protect sellers from post-sale legal complications.
• Digital Governance: Encourages complete digitisation rather than partial online services.
• Competitive Federalism: Encourages states to improve their administrative performance.
• Formalisation: Supports the organised used-vehicle market.
• Cooperative Federalism: Encourages coordination between the Union Government and state transport departments.

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