According to industry experts, in order to accelerate India’s transition to a circular economy, issues related to Viability Gap Financing (VGF) must be addressed to make it possible.
The experts were speaking in an interactive session after the release of a circular economy white paper organized by the MVIRDC World Trade Center Mumbai – an international trade promotion organization.
According to the white paper, there is a huge funding gap for aspiring and existing entrepreneurs in the manufacture of sustainable packaging.
The paper suggested the creation of a dedicated fund to provide equity and debt capital to entrepreneurs engaged in bioplastics and various other alternatives to conventional fossil fuel-based plastic products.
The funding would complement policy initiatives undertaken by the Indian government to use raw materials efficiently and reduce dependence on them.
“Circular Economy Action Plans have been prepared and rolled out for 11 sectors by the Government of India. In addition, there are policy initiatives such as EPR as well as research and capacity building towards circular economy,” said Dr. Ajay Deshpande, Adjunct Professor, IIT Bombay during the interactive session.
The session was jointly organized by the MVIRDC World Trade Center Mumbai and All India Association of Industries. Unlike a linear economy where goods are produced, consumed and disposed of as end-of-life waste, in a circular economy goods are designed and produced in such a way that they can be reused, refurbished, remanufactured or recycled at the end of their life. life, thus avoiding the production of waste.
Participating in the roundtable, Dr. Shilpi Kapur, Vice President, Environmental Management Center Pvt. ltd. suggested that large companies and original equipment manufacturers (OEMs) also work with their Tier II and Tier III suppliers to develop a sustainable and green supply chain. “A major challenge that Tier II and Tier III MSME suppliers face is that they supply materials to different OEMs that have diverse design and manufacturing specifications. In order to meet this challenge, OEMs need to come together and evolve a common design and manufacturing standard so that their Tier II and Tier III suppliers can adopt this common standard specification, instead of following various specifications from different OEMs.” , said Dr. Kapur. added.
Earlier in his welcome address, Dr. Vijay Kalantri, Chairman of MVIRDC WTC Mumbai, shared his concerns over the undue delay in the implementation of several waste management projects in various municipal corporations.
“Government of India can come up with sustainability gap financing policies to make circular economy business models financially viable. We also need effective implementation of these policies on the ground. India has a strong entrepreneurial capacity and a skilled workforce. Now we need funding and profitable technologies for businesses in the circular economy sector,” Kalantri said.