Indian Industry: Seize the Circular Economy Moment
Circular economy principles, approaches and strategies must be scaled, measured and applied as widely as possible for impacts to be fully realized in terms of livelihood creation, reduced resource consumption, reduced waste production and environmental benefits, shares Nandini Kumar
The term circular economy is overused, overworked but underexplored. The concept, rooted in systems thinking, is about changing the way resources are used, because material resources (such as hydrocarbon, metals and minerals, water, soil, land, rubber) are the basis of all economic activity. A circular economy has two simple goals:
- Minimizing raw material extraction from the earth
- Minimizing what goes to dumps or landfill.
Broadly speaking, action taken to achieve those two goals, can be called a circular economy strategy.
It is often said that India has been practicing sustainability for centuries, but the truth is, when resources were scarce and had to be extracted using manual labour, all societies lived sustainably, because they valued those resources. Machines have made it easy to extract massive quantities of resources from the earth and traded globally. But for a country like India, the greatest care must be taken to conserve, preserve and safeguard resources – especially since we aim to achieve a five trillion-dollar economy by 2027!
Growth comes on the back of increased manufacturing of goods and services accompanying social development, and consequences on the health of soil, water and air. So, how would a circular economy help? More importantly, how should Indian Industry transition to circular practice – what is the first step? What are the enablers?
Adopting circular economy principles will certainly address tightening inefficiencies in the system – inefficiencies in resource use, inefficiencies causing pollution, for example, but adopting circular principles can do much more. It can create an entire ecosystem of alternative and new business models, some of which we are familiar with, and some new.
People engaged in such businesses don’t need advanced technical or management degrees: repair and refurbishment set ups, for example, can be found in every Indian marketplace (take a round of the Chandni Chowk market or the Nehru Place market, to see the astonishing range of products that can be repaired, thereby extending their useful life) and are bona fide circular business models. Think of the number of products we use everyday, and the scope for repair – any scepticism about compromised product quality can be addressed by working out standards and specifications, but these will be effective only when products are designed for repair.
The discussion above already outlines many circular economy principles, approaches and strategies – they must be scaled, measured and applied as widely as possible for impacts to be fully realized in terms of livelihood creation, pollution reduction, reduced resource consumption and reduced waste production.
All too often, the term circular economy is equated with recycling and waste management. While recycling is certainly a circular economy strategy, it is quite low in the list of preferred measures. Reduce, reuse should be the first choices, with recycle to be adopted only where reduce and reuse cannot be applied any more. When recycling is prioritised, we lose the opportunity to explore and exploit other circular business models.
A circular economy can be equally applied to biological cycle such as those seen in agricultural operations – here all biodegradable materials are returned to the earth to allow continuation of a never-ending cycle. In the technical cycles, all materials once extracted and processed are never sent to waste but are churned into useful raw material again.
Here are some questions that are commonly asked:
- Can any business become circular?
Yes, there is always scope to increase efficiency, reduce emissions and explore new ways to engage customers. - How large does a business have to be to begin thinking about circularity?
Size is not relevant – the concept and principles remain exactly the same whatever the size of the enterprise. - How should I begin?
By examining your business, its inputs, outputs thoroughly and carefully. - How do I know how circular I am?
Measure-record, measure-record. Available metrics can be adapted to the Indian context to assess the current percentage of circularity. - Which products and services does circularity apply to?
It doesn’t matter what product your enterprise manufactures or which service it provides. It doesn’t matter if you are providing a service: circularity applies to all kinds of activities whether in a biological cycle or a technical cycle. - Is circularity applicable only to business operations?
No, it is applicable to cities and their operation, to farmers and their operations, to homes and the activities within them; in other words, a wide range of economic activities which involve inputs, outputs and processing of some kind.
In summary, the expansion and practice of the concepts above at national level, would conserve resources, strengthen India’s position in the global supply chain, bring a slew of environmental benefits and provide livelihood opportunities. Indian Industry can step up to this challenge by taking leadership to transform the way resources have been extracted and used for the last century and half.
CII’s first Circular Economy Conference is providing the platform to build a nucleus of interested businesses in India to champion and begin the transition to a true circular economy. To participate in the Conference, please write to Shourjomay.c@cii.in or shama.parveen@cii.in
By
Dr Nandini Kumar
Senior Consultant,
CII
Published on 11 November 2024
