What Is The Circular Economy?

What Is The Circular Economy?

Have you been hearing a lot about the Circular or Circularity or Circular Economy? Or seen it while shopping or in a newspaper or heard during discussions at the workplace. The concept of the circular economy has gained significant traction in recent years, emerging as a promising solution to the growing environmental and resource challenges faced globally. Let us simplify it for you here.

What is a Circular Economy?

To understand it better let us visualize what normally happens in the cycle of any product we buy. Say a Carpet. The raw materials are taken, parts and final product created/manufactured, we use it for some period and normally it is then disposed of. Disposal might be due to any reason like it is worn out or a preference for a new design. This is the traditional linear model of 'take, make, and dispose of'. Or take the case of deodorant. Once the bottle is finished it is discarded where the aluminum, plastic, or other items used go to waste.

The circular economy on the other hand emphasizes continuous use of resources, minimizing waste, and improving natural systems. This shift is not just environmentally beneficial but also offers economic and social advantages. So, in this carpet example may be repairing it and continuing to use it or repairing it and being used by someone else. When this happens so instead of discard it has gone into repair and reuse. Or in the case of deodorant how a refill can work in the design stage itself makes the difference by reducing waste and extending usability.

So, is circular economy only about continuous use?

Yes, along with continuous use, the circular economy operates on three core principles (Credit: Ellen Macarthur Foundation ):

Eliminate Waste and Pollution: By design, products are created to reduce waste and pollution.

Circulate Products and Materials: Ensuring that products and materials are reused, repaired, and recycled to keep them in the economy.

Regenerate Nature: Use renewable resources and restore natural systems.

To achieve a circular economy, products need to be designed with a focus on sustainability, durability, and recyclability.

How is circular economy better than Linear Economy?

The current dominant economic model is linear – resources are extracted, transformed into products, and discarded as waste after use. This approach not only depletes natural resources but also damages the environment through waste and pollution. The circular economy model seeks to transform this 'take-make-waste' system into one that is regenerative by design.

The impact of a circular economy can be significant. A study by the Ellen MacArthur Foundation found that transitioning to a circular economy could generate $4.5 trillion in economic benefits by 2030.

Where does India stand in terms of circularity or Circular Economy?

Indian culture is closely aligned with circular economy principles, which include.

  • Nature: Worshiping nature and celebrating eco-centric festivals.
  • Minimalism: Emphasizing simplicity in lifestyle, reducing waste and consumption.
  • Community Sharing: Strong communal practices that promote resource sharing and waste reduction.
  • Sustainable Agriculture: Traditional farming techniques of crop rotation to improve soil and water use efficiency.
  • Resourceful Food Use: Repurposing leftovers and scraps for new meals or compost.
  • Natural Textiles: Preference for reusable, recyclable cotton and wool.
  • Recycled Crafts: Artisans create new items from discarded materials.
  • Product Reuse: Extending the life of items like bottles and containers.

In our daily lives, things like the exchange of old phones or appliances are examples of circularity at the nascent stage. The advanced stage would be where easy repairability and upgradation of existing appliances would be easily accessible.

If it is so much embedded then where is the challenge?

The biggest challenge is the growing trend of consumerism and overconsumption. By reviving and modernizing these traditional practices, India can build a more sustainable and resilient future.

Are there any application case Studies for India where circular economy principles can be applied?

India, with its growing population and rapid urbanization, is facing a waste management crisis as well as a big opportunity segment. According to a report by the Central Pollution Control Board, India generates over 150,000 tonnes of municipal solid waste per day, of which only 20-25% is treated or processed. This presents a significant opportunity to implement the circular economy model in India. Some ongoing initiatives include.

  • E-Waste Management: E-waste recyclers are addressing the challenge of electronic waste by recycling materials and recovering precious metals, thereby reducing the need for virgin resource extraction.
  • Plastic waste management: Recycling plastic waste and converting it into recycled products or waste to energy.

So, what are the state or national-level actions to move towards circularity?

Different states in India to promote circular Economy initiatives have implemented the below initiatives with a focus on:





Requires all producers and brand owners of plastic products to collect and recycle their products.

Maharashtra Plastic Waste Management Rules, 2018.
Rajasthan/Madhya Pradesh/West Bengal State Plastic Waste Management Rules, 2019.


Recycled Content

Mandates the use of recycled materials in the construction of new buildings.
Use of recycled materials in the generation of renewable energy.



Tamil Nadu Green Building Policy, 2014.
Andhra Pradesh State Policy on Renewable Energy, 2015.


Require all generators of waste to segregate and dispose of their waste responsibly.

Haryana and Uttar Pradesh State Waste Management Rules, 2019.


Promote waste reduction, reuse, and recycling.

Karnataka State Policy on Solid Waste Management, 2012.

Circular Practices

Incentives to businesses that adopt circular practices.

Gujarat Industrial Policy, 2020.
Telangana State Industrial Policy, 2015.

Recently in Dec-23, India's National Circular Economy Framework, developed by the Confederation of Indian Industry (CII), outlines strategic actions to integrate circular principles into the national agenda.

So, is the circular economy the same as recycling?

Recycling is just one aspect of the circular economy. Circular economy emphasizes focus on the product's lifecycle, durability, reusability, and optimized resource use right from the design stage. While recycling is a viable option, it's not always the most efficient due to the limitations and costs associated with the process. For example, plastics can only be recycled a few times before their quality diminishes, leading to downcycling.

How can Individuals benefit and contribute to the circular economy?

Every individual can contribute to the circular economy through simple actions:

1. Reduce, Reuse, Recycle: Embrace these principles in daily life to minimize waste.

2. Clothing Swaps: Participating in or organizing clothing swaps within communities allows people to exchange clothes they no longer wear, reducing the need for new purchases and minimizing textile waste.

3. Promoting shared resources: You can promote society-level sharing of common resources that are not very frequently used. Like a ladder and toolkit. Choosing bicycles or public transportation over cars reduces carbon emissions and the demand for new vehicles and fossil fuels.

4. Composting: Convert organic waste into compost for gardening, enriching soil naturally. Composting organic kitchen waste into nutrient-rich soil for gardening reduces landfill waste and the need for chemical fertilizers.

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