Context: The Indian Cellular and Electronics Association (ICEA) recently released a report on ‘Pathways to Circular Economy in Indian Electronics Sector,’ after government’s effort with NITI Aayog to harness e-waste.

• This report, developed in collaboration with NITI Aayog, explores the possibilities of harnessing electronic waste (e-waste) to create a circular economy in India’s electronics sector.

• It highlights the significant market potential, estimated at $7 billion that could be unlocked through effective e-waste management.

What is E-waste?

• Electronic waste (e-waste) is discarded electrical or electronic devices or components that are unwanted, not working, and nearing or at the end of their “useful life.”

• Used electronics which are destined for refurbishment, reuse, resale, salvage recycling through material recovery, or disposal are also considered e-waste.

Highlights of the “Pathways to Circular Economy in Indian Electronics Sector” report

• E-waste management is largely informal in India.

• Around 90% of collection and 70% of the recycling are managed by a very competitive informal sector.

• The informal sector is good at salvaging older devices for parts and profiting from repairs with them.

• There are industrial hubs, where many printed circuit boards (PCBs) arrive to recycle gold and silver melted out of them and sold.

• Phones getting cheaper and people using them more due to cheaper data plans may lead to an increase in level of e-waste.

• Facilities that recycle are generally not equipped to extract the full potential value of the products they handle, like extracting minute but precious amounts of rare earth metals in semiconductors.

• The Ministry of Electronics and Information Technology launched a scheme to cover 25% of the capital expenditure on such facilities.

Competitiveness in Informal sector

• The informal sector relies on a number of tools and techniques to stay competitive.

• For example, cannibalization: A euphemism for repair shops buying whole devices and breaking them down to serve as spare parts for repair.

• Recommendation: Change the outlook on e-waste management to build a system where discarded electronics can have a new life, either by themselves, or by reintroducing components and precious metals into new hardware.

• There could be an additional $7 billion market opportunity in India in harnessing e-waste.

Challenges in E-Waste Management

• Informal Sector: The large and competitive informal sector is difficult to track and regulate, making adherence to environmental norms challenging.

• Device Stockpile: An estimated 200 million devices remain unused in consumers’ homes, as people are concerned about their personal data when recycling devices.

• Capital Intensive: Establishing large-scale recycling plants requires substantial capital investment, with challenges in securing stable materials.

• Material Scarcity: Securing materials to stabilize recycling plants is a complex issue, as materials are scattered and supply chains are unpredictable.

• Transition from Informal to Formal: Replicating the success of the informal sector in a formalized and reliable manner remains a significant challenge.

What is Circular economy?

• A circular economy is a model of production and consumption, where items and products are reused whenever possible rather than discarded.

• In such an economy, all forms of waste, such as clothes, scrap metal and obsolete electronics, are returned to the economy or used more efficiently.

• It is a sustainable economic model that focuses on reusing and recycling materials to reduce the consumption of natural resources and avoid waste creation.

Why is a circular economy important?

• Demand for electronics is rising across all price segments, even as the production of these devices entails the use of scarce elements and high emissions.

• Instead of salvaging electronics parts, a circular economy seeks to bring them back into the electronics ecosystem.

• There needed to be a policy push to encourage manufacturers to reuse old components.

• For example, by 2019, China ensured that 5% of their secondary raw material went into manufacturing of new products.

How can e-waste be recycled?

• Through public-private partnerships to distribute the costs of setting up “reverse supply chain”.

• It will be an expensive prospect that envisages collecting devices from users, wiping them clean of personal data, and passing them along for further processing and recycling.

• Launching an auditable database of materials collected, and creating geographical clusters where these devices come together and are broken apart.

• Incentivize ‘high yield’ recycling centers.

• Encourage repair and making products last longer by supporting right to repair by users may reduce the environmental burden of electronic waste.

Conclusion

• The transformation of e-waste management into a circular economy is a promising venture for India’s electronics sector.

• While the informal sector currently dominates this landscape, there is a growing need to formalize and regulate e-waste management.

• The challenges are substantial, but with the right policies, public-private collaborations, and incentives, India can harness the $7 billion market opportunity and promote resource efficiency in its electronics sector.