Resource efficiency is a key strategy that can transform the linear production-consumption system to one that is circular, thereby preventing wastage and overuse of virgin materials
Economic development and human well-being hinge on the availability of natural resources on affordable terms. India’s ambition of high growth and meeting human aspirations has led to the widespread use of natural resources, many of which are non-renewable and import-dependent. For example, crude oil. In 2018, India imported more than 225 million tonnes of crude oil at a cost of $ 130 billion. India’s demand for fuel and non-fuel resources has been skyrocketing in recent times owing to strong economic growth and technological advancements. Between 1990 and 2017, India’s material consumption increased almost three times from 2.5 billion tonnes to 7.4 billion tonnes.
Continued reliance on virgin materials from within India and outside for driving economic growth will not only have adverse consequences on their future availability and costs but also pose a serious threat to the environment. “Doing more with less”, also known as “resource efficiency”, has emerged as a key strategy that can transform the conventional linear production-consumption system to one that is circular, thereby preventing resource wastage and overuse of virgin materials by industries.
Resource efficiency encompasses a wide variety of technologies, processes, policy and institutional interventions along with the product and service life cycle stages. These typically include mining, design, manufacturing, consumption and end-of-life. Resource efficiency promotes life cycle thinking that helps in identifying opportunities to reduce material/resource footprint along the value chain, thus improving resource productivity and value enhancement. A resource-efficient economy would help, for example, extend product life, develop products that can be kept in circulation to minimise loss of resources, close material loops, reduce landfill dumping, and degenerating resources (incineration of waste) and so on.
The United Nations Development Agenda of 2030 (UN 2016), too, recognises the importance of efficient use of natural resources through SDG-12, i.e. promotion of sustainable consumption and production (SCP). By becoming a signatory to the UNSDG, India has committed to achieving sustainable consumption and production by 2030 by substantially reducing waste generation through prevention, reduction, reuse and recycling. India’s commitment towards promoting sustainable consumption and production is reflected through the recent draft of the Resource Efficiency policy prepared by the Ministry of Environment Forest and Climate Change (MoEF&CC). The draft of the National Resource Efficiency Policy, 2019, is considered to be a significant step towards the desired transition as it will help identify opportunities and facilitate thinking and support action towards closing resource use loops by establishing links and synergies across existing sectoral and/or resource-specific strategies.
One of the key aspects the policy focusses on is establishing an institutional mechanism that intends to promote inter-ministerial engagement and facilitate exchange of ideas for implementation on resource efficiency. The consequent changes in regulation and policies are expected to generate new economic opportunities and business models, resource-efficient products and services and increase investment and employment.
Transport is a major resource-consuming sector with high environmental impacts. A transition from personalised vehicle ownership to shared facilities can significantly improve resource efficiency in the sector. It has the potential to not only attract economic investments but also create employment opportunities for thousands of Indians.
Sustainable agricultural methods can increase yield, reduce the environmental impact and improve profitability for farmers. Further, labelling and retailing will create a market for these products at the domestic level. Strategies for reduction in food loss during handling and transit will go a long way in meeting increased per capita availability of food. In the urban environment, car-pooling clubs, sharing of building services and office spaces would also lead to saving of resources while the use of innovative building and infrastructure design and resource-efficient inputs can achieve significant energy savings.
Pricing externalities linked to resource extraction and use through taxes can increase the prices of virgin raw materials, thereby generating the economic incentive to use them more efficiently and make the secondary resources more price competitive. Resource efficiency standards are an extremely important enabling factor to promote the use of secondary raw material and products made from them. These standards not only enable identification of resource-efficient products or raw material but also indicate their quality and enhance acceptability.
Higher acceptance will lead to increased demand and generation of economies of scale. However, large-scale awareness generation efforts and demonstration projects will need to be undertaken to change perceptions about products made from waste/secondary raw material. Further, setting up of mandatory targets for recycled content in new products will stimulate and support responsible consumption demands from both consumers and businesses.
Participation, collective action and commitments from all major stakeholders, including industry, policymakers, Government agencies, academic, and civil society organisations comprising non-profit institutions, think tanks, business groups, consumers, technology developers and solution providers are essential. But this will need the support of administrative and management mechanisms for implementation and enforcement of resource efficiency measures. Business models can also be developed to design products to use them for as long as possible, reusing and then remanufacturing them at the end of service life. Further, the creation of financing mechanisms that include meeting the requirement of viability gap funding will make these business models scalable, replicable and will be able to generate larger social, economic and environmental benefits.
Technology could play an important role by enabling application of circular economy principles on a larger scale by improving access to information, management of materials through efficient recovery and recycling, tracking and logistics, transparency and accountability. Good practice guidelines and manuals help in standardisation to the extent possible and in mainstreaming resource efficiency across businesses and their value chains. India’s MSMEs form the backbone of the industrial sector. Due to the paucity of financial and human capital, resource-efficient strategies for MSMEs might remain a distant dream. Although there are schemes for these industries, there is a need to strengthen the existing industrial ecosystem between large and small entities by bringing in more capacity development, process and product development and support green procurement.
State governments and local authorities can focus on their sectoral priorities and design resource-efficient strategies at their level and become leaders in fostering resource efficiency and circular economy at the sub-national level. Given that the Niti Aayog has highlighted the importance of competitive federalism, the focus on State-level resource efficiency strategies will help in the creation of a competitive edge. Circular thinking can be embedded in designing the municipal services provision, integration of circularity principles in procurement processes and related tenders and in setting up the infrastructure of urban industrial symbiosis.
It is important to also emphasise on the need for systems thinking and consider resources from a supply chain perspective, using a life cycle approach. There is a need to tap into the synergised knowledge and expertise of different ministries and departments of the Government and promote holistic consideration and recognition of resource efficiency challenges.
Further, a monitoring process that helps assess the resource use, efficiency of sectors and resources with harmonised metrics and regular publication of results could give resource efficiency a higher profile in India’s economic growth pathway.
(Writer: Souvik Bhattacharjya | Shilpi Kapur Bakshi; Courtesy: The Pioneer)