From Scrap To Strategy: A Circular Economy For India’s Electronics Boom
One tonne of computer scrap contains more gold than 17 tonnes of gold ore. Improper recycling of e-waste is both an environmental concern and a missed economic opportunity (Image: John Cameron, Unsplash)
India’s electronics sector has recorded robust growth in recent years, with production rising from approximately US$48 billion in financial year (FY) 2016–17 to US$101 billion in FY 2022–23, primarily driven by a surge in mobile phone manufacturing and assembly operations. This has elevated India’s status as a credible global contender in the electronics value chain.
However, this raises critical sustainability and supply chain concerns. Achieving the government’s US$500-billion electronics production target by 2030 requires an estimated investment of US$150 billion to develop an integrated ecosystem for components and sub-assemblies, many of which depend on imported rare earth elements and critical minerals.
The answer to India’s sustainability challenge may lie in adopting a circular economy approach towards its rapidly growing accumulation of discarded electronic devices.
While electronics output expanded by nearly 30 percent between FY 2019–20 (US$78 billion) and FY 2022–23 (US$101 billion), rare earth imports only marked a modest 5.2 percent growth in this period. This may indicate increased material efficiency but more likely reveals a potential reliance on existing stockpiles or lagged demand for key inputs.
Given India’s limited capacity for domestic extraction and processing of rare earth elements and its high import dependence, particularly from China, this asymmetry raises concerns about long-term resilience and autonomy for the sector’s supply chains.
To mitigate these risks, the Government of India has introduced several interventions. The Production-Linked Incentive Scheme for large-scale electronics manufacturing offers performance-based financial incentives to promote domestic value addition. Tariff rationalisations now protect indigenous manufacturers from import competition. There is special focus on Micro, Small, and Medium Enterprises through targeted credit, skilling and technology adoption schemes, given their pivotal role in expanding local supply chains and deepening component manufacturing capacity.
An E-waste goldmine
In 2021-22, India generated approximately 1.6 million metric tonnes of e-waste, becoming the third largest producer globally. This figure could escalate to 5 million tonnes by 2030. Despite significant growth in electronics manufacturing, only about 5 percent of India’s e-waste is recycled through formal channels. The informal sector manages about 90 percent of e-waste collection and 70 percent of recycling, leaving an estimated 25 percent unaccounted for, which often end up in landfills, incinerated or stored improperly.
This is both an environmental concern and a missed economic opportunity. One tonne of computer scrap contains more gold than 17 tonnes of gold ore. Mobile phones contain five to ten times more gold than traditional ores. Globally, the failure to recycle e-waste properly results in the loss of precious metals worth approximately $62 billion annually.
Establishing robust e-waste management systems can address environmental issues and create a domestic source of critical materials, reducing reliance on imports. Integrating the informal sector into formal recycling processes, enhancing public awareness and investing in recycling infrastructure are essential to harness this untapped resource.
A circular economy approach can shift the paradigm. Imagine devices designed to last longer, featuring modular components that can be swapped instead of discarded. Envision a nationwide network of refurbishers giving gadgets a second life and recycling hubs extracting all reusable material through cutting-edge technology. Countries like Japan and EU members are already implementing such systems.
The informal sector dilemma
The Government of India has formalised e-waste regulation through the Extended Producer Responsibility (EPR) framework under the E-Waste (Management) Rules, 2016, and its 2022 amendment, which expanded producer obligations. Complementary initiatives like Make in India and Digital India aim to strengthen domestic manufacturing ecosystems.
However, challenges persist. Authorised recyclers often offer lower prices for e-waste compared to informal handlers who operate outside environmental safeguards and extract higher-value materials through unregulated methods. This discourages formal compliance and perpetuates unsafe practices. Further, nearly 31 percent of consumer e-waste remains outside the scope of current EPR coverage.
India’s informal sector is responsible for about 95 percent of e-waste processing. The work is often done by people without protective equipment or social protections. These workers play a critical role in material recovery but remain excluded from formal sector benefits.
Formalising the informal workforce must be a policy priority, including recognising micro-entrepreneurs, providing safety gear and fair pay and enabling access to environmentally sound technologies. Social enterprises like Karo Sambhav have demonstrated how informal actors can be integrated into formal systems through strategic partnerships.
Effective scaling of e-waste management solutions requires stronger EPR enforcement, tax incentives for eco-design and public-private partnerships to expand collection and recycling infrastructure. Startups like Attero Recycling are already deploying AI-based sorting and green extraction techniques, but scaling these innovations requires policy and financial support.
Embracing circularity
Consumers often hoard or improperly discard obsolete electronics. Changing this will require public campaigns like Swachh Bharat Mission. Imagine tech companies incentivising returns of outdated devices with trade-in discounts or schools holding “right to repair” workshops equipping students to maintain devices to cultivate a generation of conscious consumers who value repair over replacement.
India is projected to consume 15 billion tonnes of raw materials annually by 2030, with e-waste volumes expected to double. With the right interventions, this crisis can transform into an opportunity. Recovering materials from discarded electronics will reduce demand for virgin resources, cut emissions and enhance material security.
Circularity reduces import dependence, fosters sustainable employment in green sectors and supports India’s US$500 billion electronics manufacturing goal while aligning with climate objectives. However, no circular economy can thrive without inclusive recycling systems. The E-Waste Management Rules (2022) mandate that producers recycle up to 80 percent of their e-waste by 2028. Achieving this will require integrating informal collectors into authorised recycling pathways.
The government must prioritise capacity building, including training, financial assistance and simplified registration for micro-enterprises. Partnerships between informal workers and large manufacturers can ensure traceable, safe and efficient recycling. A robust circular electronics economy will position India as a leader among emerging economies striving to balance industrial ambition with planetary limits.
(Published under Creative Commons from 360info™. Read the original article here)
