Converting Waste to Wealth, Part 1: Challenges Plaguing Waste Management in India
This is part one of a three part series that will cover the challenges, drivers and future of waste management in India
“We are fourth-class citizens,” said Mohammed Ismail, 66, a small kabbadiwalla. “Nobody listens to us. We die like insects. If this colony had been a VIP colony, the dump would have been removed.”
India generates over 150,000 tonnes of municipal solid waste (MSW) per day, with Mumbai being the world’s fifth most wasteful city. With only 83% of waste being collected and less than 30% being treated, Indian cities have a serious challenge at hand¹. The sector has been plagued with poor segregation practices, which results in overfilling of landfills and presents numerous social and environmental challenges. There is then the invisible plight of thousands of waste-pickers who sustain their livelihoods by collecting, sorting, and trading waste; in an entirely informal ecosystem. They have no bargaining power for their efforts, and are left at the mercy of kabadiwallas who dictate terms of sale and payment cycles.
Private organisations have identified the massive opportunity that lies within the waste management sector, however most companies in India have been unsuccessful over the past decade. While there is a huge market opportunity in waste management, a combination of structural and market issues have hampered the growth of the sector.
- Informal System: The waste management sector is a highly fragmented space with different kinds of waste generators and informal aggregators operating in a broken supply chain resulting in an opaque business environment, with few formal institutional players.
- Lack of Segregation: Lack of segregation is one of the primary reasons India is drowning in its own garbage. If we institute and enforce segregation at source, our landfills can operate more efficiently, thereby reducing a number of environmental and health concerns. The overflowing landfills are the root cause for soil and water pollution and have the potential to snowball into a massive ecological hazard.
- Standardisation of Waste: With multiple intermediaries in the sector, recyclers struggle to get raw material in their desired quality and quantity. The long & fragmented supply chain results in inefficiencies and pilferages. This issue is further complicated when one has to consider the ‘garbage mafia’, who are present in various cities and own many illegal dumpsites. They disrupt waste collection drives through the city and create an opaque pricing structure for recycled goods.
- Government capacity: The role of municipal authorities in waste management is key. Currently, urban local bodies are under-resourced, underpowered, and subject to political constraints. Municipalities need to be supported by skilled staff and appropriate technology to ensure local recycling and composting systems work. Waste pickers need to be integrated within the society in ways that draw on their experiences and expertise, and offer dignity and rewards in return for reliable service.
The above issues notwithstanding, over the past 5 years there has been an influx of business models focussed that cater to the unique obstacles of the Indian market. We believe waste management in India is finally at an inflection point and well poised for formalisation and consolidation. A combination of drivers — shifts in consumer behaviour, supportive policy environment, and technological innovation, to name a few, have created an enabling atmosphere for the sector. We will cover these drivers and a few innovative business models in the next part of this series.
If you have any thoughts on the sector, or are an entrepreneur championing waste management in India, feel free to reach out to us at email@example.com