The idea of circular economy ‘challenging’ but It’s the best bet for visionary firms, say experts: Coverage of the CAIF Conclave at the 13th Edition of Sankalp Global Summit in Economic Times

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  • The idea of circular economy ‘challenging’ but It’s the best bet for visionary firms, say experts: Coverage of the CAIF Conclave at the 13th Edition of Sankalp Global Summit in Economic Times

Circular economy offers a clear and credible pathway to achieve sustainably — one that equally puts focus on people, the planet and profit, said experts at Sankalp Global2021.

While deliberating about issues around sustainability, experts stressed the need for businesses to rapidly adopt industry best practices from across the globe. Forward-looking firms will leverage the idea of sustainability and circular economy, the panel said.

The virtual event, held from October 12-14, brought entrepreneurs, investors and policymakers on a platform to share ideas and grow together.

Rene Van Berkel, Representative, Regional Office, UNIDO India, said the long-term benefits of the circular economy has to be explained to all stakeholders in the ecosystem, especially consumers as their involvement is crucial for a broader acceptance of the idea. “The textile and apparel sector is a huge industry worth $1.5 trillion. If it was a country, it would have been the 14th largest country in the world or of the same size as that of Australia. However, the greenhouse gas emissions of the sector are about 10% of the global emissions, which exceeds those from the aviation and maritime industry clubbed together,” he said.

A circular economy focuses on reusing and recycling products and on sustainable business practices.

The Indian textile industry, traditionally a labour-intensive industry, has long been plagued by issues around sustainability. Due to a large number of informal players who are yet to join the circular economy bandwagon, the segment is often touted to be one of the major polluting industries in the country. However, industry and the government are trying to transform this.

Globally, customers are increasingly making their buying decision based on whether the raw materials in the product have been sourced sustainably or not. Being part of a circular value chain gives an added USP to products, say industry observers. The growing trend is leading to a big demand for products made by firms employing sustainability-driven practices. To address a lacuna in the market, industry bodies — including the Textile Association of India, Apparel Export Promotion Council, Cotton Textiles Export Promotion Council — have taken the necessary initiatives.

India — along with Bangladesh, China, Vietnam, Pakistan, Sri Lanka and Indonesia — is a major textile manufacturing hotspot in the APAC region. Rated as the leading foreign exchange earning sector for India, the sector is estimated to grow to $190 billion by FY26, according to IBEF research.

Another takeaway of the deliberations at Sankalp is that the nuances of a business remain critical for circular business models to be adopted at scale.

Siddharth Lulla, Lead-Corporate Strategy for the Circular Apparel Innovation Factory (CAIF), emphasised the need to address perceived as well as real challenges associated with the concept. One such barrier is a lack of clear evidence of financial viability. “A circular business model that looks great on the balance sheet but does not have positive people and planned outcomes will ultimately fail to meet its potential.” Lulla said this issue is more critical in the context of manufacturing hotspots in Southeast Asia.

Freija Vermeer, Program Manager, Food Sustainability & Circular Economy, the DOEN Foundation, said stakeholders should not underestimate the effects of innovation even if it’s small. Some changes in the manufacturing processes can go a long way in achieving this goal.

Highlighting the role of business interventions, Vaishali Kulkarni, Founder & CEO, KBCols Sciences Pvt Ltd, said polyester is generally dyed at 130 degrees Celsius but with the firm’s unique technology, the required temperature has been reduced to 85 degrees. This has been beneficial for the sector. “We have seen that possibility with multiple fabrics. We now have tried almost every fabric,” she added.

For Gigi Mathews, Country Director, Enviu India, embracing circularity in the textile industry is “not an option” anymore. It has become an imperative. “There’s already pressure to consume less energy, use fewer resources and produce less waste. But it’s also important to scale and be profitable too. So, we have seen that conversation has started moving from CSR corridors to finance decision-makers,” she added.

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