The Ministry of Environment and Forests has reportedly simplified targets for electronics makers to collect e-waste depending on their yearly sales.
Government rules have identified that the life of a smartphone is five years, while that of a feature phone is seven years.
Following this, the reports claim that “handset makers selling phones prior to five years or seven years have to collect e-waste equal to 10% of the sales done in the financial year five or seven years back, while those starting operations later will need to meet lower targets of 5%.”
Consequently, established electronics makers like Samsung, Micromax, etc. will have to collect e-waste equal to 10% of smartphones sold in FY 2013-14, in fiscal 2017-18, since they have been selling smartphones for more than five years in India.
While Chinese players like Oppo, Vivo, etc. which have entered India in the last three or four years, the target for the present fiscal has been reduced to 5% of sales in 2016-17.
The new e-waste collection targets, also known as the Extended Promoter Responsibility Plan “will rise by 10% every year for older companies until it hits 70% by FY24, and will stay at that level from that year onward”.
But for newer companies, the target for FY 2018-20 is at 5% of the sales done in FY 16-18, which will rise to 10% in FY 2020-2022 for sales done in the consecutive financial years. This target again rises to 15% in FY 2022-24 and 20% from FY 2024 onwards.
Earlier, the rules stated that older companies had to start with a target of 30% collection of the sales done in previous years, while new companies had to meet a target of collecting e-waste equal to 10% of the sales.
India: Major Player In Smartphone Market
According to a recent report by Forrester, the global mobile user populace is expected to touch 5.5 Bn by 2022, with India leading the growth.
A Quarterly Mobile Phone Tracker report by research firm IDC (International Data Corporation) revealed that Chinese players including Xiaomi, Vivo and Oppo have taken a 54% share of the smartphone market since their entry in 2013 in India.
Another report by Canalys says India has now overtaken the United States to become the world’s second-largest smartphone market after China. Samsung and Xiaomi, which shipped 9.4 Mn and 9.2 Mn units respectively, accounted for almost half of the total market as the top five vendors continued to post strong growth in Q3 2017.
As per a Morgan Stanley report, India is the world’s fastest-growing smartphone market growing at 23% CAGR. A report by Groupe Speciale Mobile Association (GSMA) expected India to have over 5.7 Bn mobile phone users and 340 Mn smartphone users in 2017. Statistics further show that an average smartphone user replaces a phone in 15-18 months, thereby suggesting that a smartphone is used by a minimum of three people before it exhausts its life cycle.
The change in the e-waste policy opens up the scalability option for e-waste and recommerce startups, which can contribute a lot to help the government in e-waste handling. Some of the major players in mobile recommerce are Budli, Zefo, Yaantra, etc.
With electronics becoming major sales products in India and smartphone market growing considerably, this change in the rules for e-waste collection will certainly mark some new speculations in the market. Whether it brings much relief or adds to extra burden to the electronics market, only time will tell.