Growth Without Carbonising: India's Move To Circularity Takes Baby Steps

The Central Consumer Protection Authority had earlier sought comments on the draft guidelines for the Prevention and Regulation of Greenwashing to ensure accurate claims in environmental advertisements. Curbing greenwashing would ensure companies walk the talk on sustainability rather than make tall claims and help in moving towards circularity. 

So, what exactly is circularity or circular economy? The Ellen McArthur Foundation says, “The circular economy is a system where materials never become waste and nature is regenerated.” Greenpeace USA executive director Annie Leonard adds, "There is no such thing as 'away'. When we throw anything away it must go somewhere." Circularity thus is possible when resources are used to their best possible potential and become drivers for economic growth and development. 

At FICCI's circular economy symposium recently, India's G20 Sherpa Amitabh Kant said the transition to a circular economy can bring significant benefits to the country, ranging from environmental conservation to economic growth and job creation. Kant had said that India should become the first country to industrialise without carbonising, creating a unique model of development.

Sounds like a tall ask doesn't it? But circularity is deeply ingrained in Indian society in its traditions of resourcefulness and waste reduction that predate modern times.

For consumers, there are deeper questions: Are we questioning the impact our wants and needs leave on nature? Are we giving ourselves a false sense of security by continuing with single use plastic spoons, straws, and bottles? These kinds of questions can force a consumer to reimagine consumption and push for a structural overhaul. 

Setting The Foundation For Systemic Change

Among the top 10 municipal solid waste generators worldwide, India generates 65 million tons of waste annually of which 62 million tons is organic waste and recyclables, as per The Energy and Resources Institute data. Just 22-28 per cent of the waste collected is processed and treated, the rest is dumped at landfill sites. 

To offset this scale of waste generation, the NITI Aayog set up 11 committees in 2021, with respective ministries, to develop strategies for resource efficiency in steel, aluminum, construction and demolition, and e-waste. 

Apropos Amitabh Kant's dream of India becoming the first country to industrialise without carbonising, there is much to be done. At the moment, India lacks a formal marketplace for the ecosystem, which has the potential to mitigate climate change thus contributing to net zero targets, creating a unique development model. 

Such systemic change can only be brought about if social inclusion is at the core of the process. The safety of workers in the informal sector, health coverage and formalisation of the workspace become important parameters.

Further, community engagement is essential to address social inequities and fair resource distribution. Circularity can thus lead to asset creation with the added value placed on resources and effectively "close the loop" by the creation of new and better products.

Why Circularity Makes Sense For India

Being a cost-sensitive country, India needs to harness its resources well and in an input-conscious way to achieve sustainable growth. With disparately increasing consumption patterns, the country will do well to mobilise resources towards sustainable material management and the entire value chain, rather than just minimising pollution at the end of life. 

Thus, eco-design and waste recovery are crucial in India and to the movement to minimise greenwashing. ESG disclosures should be carefully reviewed since exaggerated claims of sustainability practices rule the roost due to a lack of regulations. The shortage of a transparent framework has led to many companies misleading consumers without any repercussions. 

It is in this context that the Draft Guidelines for Prevention and Regulation of Greenwashing is an attempt to bell the cat. 

Opportunities Beckon 

India’s transition to a net zero economy has the potential to create 50 million jobs with a US$ 15 trillion projected contribution to the GDP. Kalaari Capital's report projects India's circular economy to reach US$ 4.5 trillion by 2030, potentially saving US$ 624 billion by 2050. The key sectors for enabling a circular economy include food, agriculture, construction, mobility, fashion, and rare earth elements.

If the country manages to capture just 1 per cent of the global circular economy market, the market opportunity swells to US$ 45 billion. If it levels its circular economy contribution to that of its global GDP, then India is looking at a domestic circular economy market of US$ 380 billion.

Over the last five years, India's circular economy has attracted US$ 1.8 billion, mainly for energy and transportation advancements. These sectors have thrived due to supportive policies and standardised frameworks as they contribute to 70 per cent emissions. Remarkably, 84 per cent of investment value and 61 per cent of deal numbers are dedicated to green projects.

However, much more needs to be done to increase funding in the circularity and waste management space along with a lot of problem-solving. Smart agriculture, waste management, and natural resources are sectors that are still developing in India and attention is needed for these sectors.

Waste management pioneer Saahas has released its annual Circular Impact Report for 2023, highlighting interventions. These interventions have resulted in significant achievements, such as 98 per cent landfill diversion, 100 per cent waste segregation at source, a 36 per cent yearly increase in waste processed, and a 21 per cent yearly increase in sourcing from MSMEs.

Interventions by Saahas and others are making a substantial environmental and social impact across 22 states in the country. Some sectors that can contribute to the circular economy are discussed further below.

Similarly, Hyderabad-based company Recykal offers a smartphone app that connects local recyclers with nationwide buyers, empowering both parties. This is one of many disruptions in India's circular economy, optimising energy and resources through circular products and efficient waste management.

Less than half of Indian textile waste is recycled, but circular models such as garment reusing, thrifting, and renting can help increase recycling rates. Other opportunities for circularity in the mobility sector include multimodal transport, Mobility as a Service (MaaS), electric vehicle (EV) manufacturing, and Battery Management Systems. As EVs require more rare earth minerals than conventional cars, replacing them with sustainable materials and implementing urban mining practices can reduce environmental harm. Improved farming practices and post-consumer recycling can help reduce the 40 per cent of wasted food in India worth nearly Rs 89,000 crore/year, equivalent to 1 per cent of GDP. 

What Do Experts Say

Revathy Ashok, sustainability champion and CEO of Bengaluru Political Action Committee (BPAC), said, “Traditionally Indians have lived with sustainable waste and we have forgotten that over the course of around 30 years. Circularity has its roots in the past and we need to revisit those roots.”

Ashok added,  that community-level training and engagement needs to happen to ensure waste segregation and enable a circular economy. "Citizen behaviour has to change and evolve and this can happen only through community level training and engagement,” he emphasised.

Championing waste management has been at the forefront of BPAC’s agenda for many years, right from school-level programmes in its early years. Ashok said legislation in Bengaluru is better off when compared to other megacities, but lacks strict implementation.

BPAC’s “My place of pride” challenge recognised eco-friendly communities of Bengaluru. It was a platform for communities to showcase their initiatives, create awareness, and encourage others to emulate best practices. Leadership from civic organisations to solve urban issues should be at the forefront to drive circularity. 

Saahas founder Wilma Rodrigues said, “The government needs to review their narrative on circular economy. The concept of “reduce, refuse, reuse” can be possible business models if there is a push from the government to the industry to move in that direction.”

“Although Extended Producer Responsibility (EPR) does get a mention in Niti Aayog and Ministry of Housing and Urban Affairs reports, there is an absence in connecting dots when it comes to current policy documents and frameworks,” she added. 

India’s Way Ahead

India is stepping towards a circular economy with the government establishing committees to transition the country in this direction. To become a global leader in this field, the government must prioritise supply side incentives and also focus on demand interventions like purchase obligations and subsidies.

As Saahas’ Wilma Rodrigues highlighted, “Circular economy has the potential to create more jobs, social security, and minimum wages, benefiting not only the base of the pyramid but also seniors, professionals, and startups. The formalisation of the informal sector is crucial for the success of this transformation.”

Besides, the government should provide the necessary ecosystem and frameworks for younger entrepreneurs to thrive in the circular economy. Implementing these changes will contribute to a more sustainable, prosperous and inclusive future for India.

(The author is a public policy and urban transportation enthusiast and specialist. Views expressed are personal)