ISSN 2330-717X

New Report Says ‘Circular Economy’ Will Fetch India Billions – Analysis

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By Devinder Kumar

As India takes a prominent place in the globalised economy, it can choose its development path, and look beyond a linear ‘take, make and dispose’ model of growth by embarking on a circular economy transformation, and thus create economic, environmental and social value for its businesses and population, says a new report.

All the more so because “in an interconnected world predicated largely on a linear economic model, India’s development faces resource challenges and negative externalities – yet this scenario is not inevitable, and many opportunities can be derived from adopting a value-preserving model”, says the report produced by the Ellen MacArthur Foundation in association with the United Nations Conference on Trade and Development (UNCTAD).

The report is the first conducted into a developing country by the Ellen MacArthur Foundation, which was set up by Ellen MacArthur, a world-famous British yachtswoman, in 2010. It was launched in New Delhi on 5 December 5, ahead of an international briefing scheduled for December 12 in Geneva.

According to the study, the circular economy is one that is restorative and regenerative by design, and could make more effective use of materials and energy in a digitally enabled model of development.

In particular, India could save $624 billion a year by 2050 if it adopts circular economy principles rather than following a conventional but more wasteful development path, declares the report.

The Ellen MacArthur Foundation, an economic research and innovation think tank, promotes the concept of a “circular economy”, which as it proclaims “is restorative and regenerative by design, and which aims to keep products, components and materials at their highest utility and value at all times”.

“Today’s linear ‘take, make, dispose’ economic model which relies on large quantities of cheap, easily accessible materials and energy, is increasingly challenged in the long term. A circular economy is an attractive and viable alternative that businesses are already exploring,” the Ellen MacArthur Foundation said.

According to the study, pilot projects have already shown these practices contributing towards cost savings of hundreds of millions dollars per year.

“Increasing circularity can help unlock efficiencies, opening up urgent investment opportunities and delivering environmental, economic and social gains,” Guillermo Valles, Director for International Trade in Goods, Services and Commodities, UNCTAD said.

“Lessons from this work in India serve as an important example for other developing countries seeking to meet both the Sustainable Development Goals (SDGs) and commitments in the Paris Agreement,” he added.

India’s ambassador to the United Nations in Geneva, Ajit Kumar, said: “India is earnestly working towards finding ways to improve the living standards of its citizens, compatible with its resources. Sectors such as mobility, agriculture and construction will play a crucial role in the future growth of India. The suggestions contained in the report are therefore, noteworthy and timely.”

Dame Ellen MacArthur, founder of the Ellen MacArthur Foundation, said: “This report builds on the Foundation’s previous analysis of the circular economy opportunity for Europe, by exploring for the first time the potential of applying the circular framework in a fast-growing market context.

“With its existing circular mindset and strong digital backbone, India can reap significant economic and societal benefits, embarking on a positive development path as it focuses on regenerative practices.”

The report says that better product design and innovative business models could generate cost savings and increase profits for businesses, in parallel with the shift to digitally enabled platforms for asset sharing, such as Zipcar (‘own the trip, not the car’) in which procuring services replaces owning goods.

A shift from selling cars to providing vehicles as a service could create new revenue streams for India’s car industry. Only about 2% of the Indian population currently owns a car, but the demand for mobility is increasing, the report says.

Using data from UNCTAD, the report estimates that India could save costs amounting 11% of its current GDP in 2030 and 30% of GDP in 2050 if proven circular approaches were adopted by the public and private sectors. Greenhouse gas emissions could be cut by 44%.

The report offers insights based on extensive desk research, expert interviews and expert input events in India with participants from businesses, government, universities, NGOs and other organisations. UNCTAD contributed to the report as a knowledge partner.

A high-level economic analysis has been carried out to show potential benefits of following a circular development path for the Indian economy, environment and citizens.

The research has developed detailed circular economy opportunities in three focus areas: cities and construction; food and agriculture; and mobility and vehicle manufacturing.


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IDN

IDN

IDN-InDepthNews offers news analyses and viewpoints on topics that impact the world and its peoples. IDN-InDepthNews serves as flagship of the International Press Syndicate Group, partner of the Global Cooperation Council.

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