India's Electronics Sector To Unlock $7 Billion Revenue From Circular Economy By 2035: ICEA

A joint report by India Cellular & Electronics Association (ICEA) and Accenture notes that public and private partnerships can help India’s electronics industry increase its revenue via six circular business models
According to the new ICEA report, circular models can reshape the electronics sector, driving economic growth and boosting resilience.
According to the new ICEA report, circular models can reshape the electronics sector, driving economic growth and boosting resilience.

Circular business models can help India's electronics sector tap into additional revenue of $7 billion by 2035, states a joint report published by India Cellular & Electronics Association (ICEA) and Accenture on Monday. The report identifies six circular business models in the country's electronics sector—circular design,product-as-a-service, repair, resell, refurbishment and recycle.

As it stands, these business models have a projected market size of $13 billion by 2035. Appropriate public and private sector actions can push the market size to $20 billion in the next 12 years, according to the report. If this circular transition is not made, India's electronics industry stands to lose 1-3 per cent of its EBITDA (earnings before interest, taxes, depreciation, and amortisation).

Speaking at the report launch, Pankaj Mohindroo, chairman of ICEA, said, “I am confident that the electronics industry would facilitate sustainable circular economy practices to ensure a sustainable green future for the generations to come.” 

To harness the untapped potential amounting to 35% of all revenue, the report lists five key trade-offs that the industry has to make. Formalisation of India's informal e-waste collecting infrastructure is one important step in this regard. 

“Of the six business models, three (Repair, Resell and Recycling) are already prevalent at scale, largely dominated by the informal sector presence,” the report notes. The joint study finds that the large informal sector presence comes with significant negative environmental and social effects. 

Around 90 per cent of collection and 70 per cent of the recycling are managed by the informal sector which lacks the technical know-how to extract maximum value out of discarded electronic components. This results in increased expenses during the entire recycling process.    

“One of the recyclers said that the materials they extract are unfortunately not good enough to be reused. So, they extract the material and lacking the technology to [refine] it, they export it for peanuts. The same stuff with a little bit of technological innovation is imported back [at higher cost],” said Sudhendhu Sinha, advisor at NITI Aayog. 

If we have the required technology domestically, then the unnecessary back and forth movement can be avoided, Sinha added. 

Although the leap from $13 billion to $20 billion revenue is very ambitious, the Indian industry is competent enough to achieve this, opined Ved Prakash Mishra, director in the Ministry of Environment, Forest and Climate Change. He said, “The Ministry will monitor this very strcitly. We will ensure authenticity with the help of third-party auditors.” 

Related Stories

No stories found.
Outlook Business & Money