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From India’s steel industry to paper manufacturing, aluminum production and beyond, it is impossible to ignore the significance of the import of the waste generated in the European Union (EU). But the import of this waste is expected to become dearer for Indian businesses as the EU has come up with an updated set of rules on these exports.
The new rules have tightened the criteria for shipment of waste materials from the EU, especially for countries that are not part of the Organisation for Economic Co-operation and Development (OECD).
India is one such country.
Indian businesses recycle this waste to manufacture finished products.
Historically, the EU’s law on shipment of waste, which includes rules on transporting waste across national borders, was introduced in 1993, followed by another regulation in 2006. But recently, on April 11, the EU’s New Regulation on Waste Shipments was adopted.
The pre-existing regulations put a general ban on export of waste for disposal and a ban on export of hazardous waste to non-OECD countries for the purpose of recovery. Now, the new set of regulations also prohibit export of non-hazardous wastes to non-OECD countries but exceptions might be granted to entities that will meet specific environmental conditions.
Navigating EU’s ‘new’ rules on waste export
The EU ban on waste exports for disposal and ban on hazardous waste for recovery to non-OECD countries would continue to apply but new rules will also include non-hazardous exports from 2027 when the new rules are implemented.
The rules for waste shipments within EU member states have different procedures to follow which includes prior notification and consent or providing general information, depending on the type of waste, its treatment and the destination country.
Beyond the EU, the rules are different for OECD and non-OECD countries.
The procedural framework for exports to OECD countries outside the EU are almost similar to that of the member states. However, the monitoring of exports will be ramped up and exports would be suspended for particular wastes if the waste is not managed in an environmentally sound manner.
In the case of non-OECD countries, the EU will enforce stricter rules on exports of non-hazardous wastes, also known as ‘green listed’ waste.
The export of non-hazardous waste has generally been prohibited to non-OECD countries but exceptions might be granted to countries that will meet specific environmental conditions laid out in the new regulation. Countries that wish to continue receiving the import from the EU need to submit their request to the Commission by February 21, 2025.
As per the EU Commission, these new rules have been brought in with the aim to ensure:
That the EU doesn’t export its waste challenges to third world countries and contributes to environmentally sound management of waste.
To strengthen enforcement to prevent illegal shipments of waste occurring within EU and from EU to other countries
To increase traceability of shipments within the EU and facilitating recycling and re-use
It is reported that templates have been provided for any competent national authorities to submit requests for inclusion based on evidence that shows that the country can ensure environmentally sound waste management.
Based on these applications, a list of non-OECD authorities would be prepared by the EU who would be authorised to import specific waste streams.
Also, all EU companies that are exporting their wastes outside the EU will have to ensure that the facilities that are receiving their waste are subject to an independent audit that verifies that these facilities manage the waste in an environmentally sound manner.
The waste exports from the EU to non-OECD countries have increased by 72 per cent since 2004, which went up to 35 million tonnes in 2023. In 2022, the EU exported 32.1 million tonnes of waste to non-EU countries.
As of 2022, the largest destination for the waste exports from the EU was Turkey with a volume of 12.4 million tonnes, whereas the second largest destination was India with 3.5 million tonnes of waste.
Also, amongst the wastes that are being exported from the EU as of 2022, ferrous metal wastes accounted for more than 55 per cent (17.8 million tonnes) of the total waste exported from the EU, followed by paper waste (4.9 million tonnes) and non-ferrous metals
The total paper production in India is recorded as 21.68 million tonnes per annum as of 2020. About 76 per cent (16.29 million tonnes) of this production is waste-paper (recycled fibre) based, corresponding to this production about 18.5 million tonnes of waste paper has been utilised in the country considering 80 per cent conversion rate from waste paper to paper.
As per estimates from CSE’s latest report on waste paper circularity in India, about 6.5 million tonnes of waste paper (35 per cent) has been imported by India and about 12 million tonnes of waste paper was available domestically.
India imports a majority of its waste paper from the United States, the United Kingdom, Canada while about a quarter of its imports are from the EU. The main destination for EU’s paper waste exports is India, which receives 30 per cent of its total paper waste export.
Rajeev Gupta, Director, Dev Priya Product Ltd. (a pulp and paper industry), who handles the import operations of the company, told Down To Earth (DTE): “Under this scheme, both the exporters and importers will have to undergo inspection by designated agencies. The importing mills in India during inspection shall be checked for proper waste management i.e. treatment of effluent water, air and non-recyclable waste generated during pulping as well as working conditions in the mills”.
He further said “These rules are likely to impact more than 25 per cent of the pulp and paper industries in India, which might face difficulties in passing these inspections and may become ineligible for imports from the EU”.
India produced around 118 million tonnes of crude steel as of 2021 and plans to almost double its production to 255 million tonnes by 2030. In 2022-23, India used around 32 million tonnes of steel scrap, of which around 9.8 million tonnes was imported (a jump from the previous years) and the rest was domestic.
The three top countries from where India imports its steel scrap were the United States (19 per cent), United Kingdom (17 per cent) and the EU (eight per cent).
The chief of sustainability of a leading steel company in India told DTE on the condition of anonymity:
“Currently, these new rules are more likely to impact the smaller steel makers as they are the ones more dependent on imported scrap whereas the bigger steel companies are mostly using internal or domestic scrap. Although, all large steel producers plan to increase their scrap usage in the future and for that they might have to depend on imports in the coming times.”
“Hopefully this regulation wont impact the bigger steel players even later on, as most of them are well equipped to handle any environmental hazards, it’s the smaller steel producers which might have to face the heat.” the official added.
Just to note that the secondary steel sector in India is comparatively smaller in scale.
India, Pakistan and Bangladesh are the biggest hubs of ship breaking and recycling in the world. Alang in Gujarat, is the main site where this sprawling business booms.
Regarding the new rules on waste shipment, the Alang ship recyclers told DTE that there is lack of clarity about the applicability of the rules amongst the importers.
They stated that they were aware of the EU’s Ship Recycling Regulation which prepares a list of EU approved ship recycling facilities that are environmentally sound and follow their regulations. However, there is little understanding about the new regulations.
A major reason behind this lack of understanding is that none of the ship breaking units in India, Pakistan or Bangladesh are presently EU approved, and are not dismantling EU ships. Some of the ship recycling unit owners at Alang told DTE that officially no EU-flagged ship can be dismantled in these three countries as of now and if found, the concerned parties are heavily penalised.
In 2011-12 , India received a total of around 415 ships for dismantling, but this number has fallen over the years to just 141 ships in 2021-22. The ship recycling owners at Alang told DTE that the major reason behind this fall in numbers is the cheap labour availability and better prices for the ships in Bangladesh.
India is the largest importer of aluminum scrap in the world. Almost 90 per cent of aluminium scrap used in India is imported and recycled aluminum amounts to 30 per cent of the overall aluminium production of the country. India remains the most important destination country for European aluminum scrap as of 2024, with a volume of 296,000 tonnes, followed by Turkey. Other major imports of aluminum scrap come from the United States, UAE and UK.
India has a production capacity of 3.6 million tonnes of aluminum as of 2020-21. It plans to increase its production threefold to 12 million tonnes by 2030. The share of recycled aluminum in India is set to reach 35 to 40 per cent of total aluminium consumption in the next few years.
It is important to mention that most of the aluminum scrap used for manufacturing is imported. Thus, to increase aluminium production, India’s appetite for aluminium scrap imports is set to increase.
Currently, the unorganised sector is majorly using the scrap for recycling and these facilities operate at outdated technologies with high levels of pollution. The high volume of scrap import can have an impact on the unorganised sector as large players like Vedanta and Hindalco are not much dependent on scrap.
India is a major destination for the top categories of wastes being exported out of the EU and industries in India are dependent on waste exports from the EU. The unorganised sector, the smaller players and in some cases even the large scale industries are dependent on waste exports from the EU
Although the new rules advocate for environmental protection, and push the waste consumers in these countries to become environmentally friendly, it is important to note that without providing the necessary technology, funds, knowledge and resources, this may end up impacting livelihoods at a large scale in the developing world.
This is also a major indication for countries like India to work towards ramping up their domestic recycling as much as possible.