Resource Efficiency Is Critical for India, Climate Policy and Beyond

Material resource exploitation is fundamental to any society, and adequate access to resources is essential for a dignified life. However, it is also associated with serious environmental impacts, including ecosystem degradation and pollution. The extraction, processing, use and disposal of resources are directly related to significant energy use as well as greenhouse gas emissions. At each stage of the resource life cycle, significant energy savings can be made. For example, producing 1 KG of metal from scrap requires less than half as much energy (and therefore carbon emissions) as extracting it from ore. Therefore, decoupling economic and human development from resource use has to be an integral part of climate policy. Indeed, given the urgency of the climate targets, it is unlikely that the Paris climate goals can be met without a robust commitment to resource efficiency. Thankfully, reduced import dependency, increasing economic competitiveness, job creation, pollution reduction and improved public health, reduced conflicts related to mining, etc., are potential co-benefits of resource efficiency and can enable sustained support of citizens, businesses and policymakers.

In the recent past, comprehensive and holistic approaches to resource efficiency are being adopted globally. The European Union (EU) has led the way with the Circular Economy Action Plan in 2015. Many European countries have their own ambitious policies, in particular Germany, with its Resource Efficiency Programme (ProgRess) launched in 2012. In Japan, the “Law for the Promotion of Effective Utilization of Resources (LPEUR)” is central to the circular economy framework, building on the nation’s longstanding — often highly successful — recycling-based initiatives. China’s adoption of a Circular Economy Promotion Law, while limited in scope, is extremely significant since China is the world’s largest consumer of resources and emitter of GHGs.

Like China, India faces a massive increase in resource consumption. Between 1970 and 2000, India’s total material resource consumption increased three times, and it is estimated that at current economic growth rates, national resource demand will be five times 2010 levels, by 2050. This is not surprising given India’s enormous infrastructure needs and manufacturing goals. India is endowed with significant natural resources but remains highly import dependent for several critical minerals, including phosphate, cobalt, nickel, copper and lead. On the other hand, India’s extraction intensity (tonnes/km2) is already the highest in the world and most mineral reserves overlap with areas of valuable biodiversity and/or tribal lands. Extraction-related pollution, ecological degradation and conflict have been troublingly commonplace in India. Under these circumstances, India has no choice but to seriously pursue a decoupling strategy based on resource efficiency.

The UN’s International Resource Panel finds that, through decoupling, developing countries could cut their increase in annual energy demand by more than half over the next decade. A study by the Ellen MacArthur Foundation, focusing on selected sectors, estimated that a circular economy path could bring India annual economic benefits of USD 600 billion in 2050 compared with business-as-usual (BAU); a benefit roughly equivalent to 30% of India’s current GDP. It also found significant co-benefits, including a 44% reduction in GHG emissions in 2050 compared to BAU.

It is encouraging that the Government of India has taken up this issue seriously. Under Indo-German cooperation, the Indian Resource Panel was established in 2015. Building on the Panel’s recommendations, the Ministry of Environment, Forest and Climate Change (MoEFCC) has established a Resource Efficiency Cell. The NITI Aayog has also developed a Strategy on Resource Efficiency and convened an inter-departmental group of stakeholders for time-bound implementation, starting with selected sectors. Challenges identified include the dominance of the informal sector in recycling, patchy data on waste streams, poor governance and monitoring of “minor” minerals, inadequate standards and certification for “green” products, and inadequate capacity at the municipal level.

Many of these challenges have been overcome in isolated cases with innovative policy and sustained efforts of all stakeholders. For example, use of fly ash from power plants in the cement and construction industries has shot up to more than 60% from virtually nothing in less than two decades. In principle, there is no reason why such successes cannot be replicated in other sectors. Measurable progress in several sectors may be achievable in 3–5 years given the urgency being demonstrated by NITI Aayog. However, wider awareness and engagement of all stakeholders will be necessary to achieve transformative outcomes in the longer term.

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