Prices of consumer electronics may go up 30% under tougher e-waste rules

Prices of consumer electronics may rise by 30 per cent across the nations if the government does not roll back the tougher norms on e-waste recycling that it has proposed, consumer electronic companies have warned.

The government is currently proposing to amend the existing E-waste (Management) Rules, 2016 and has invited industry suggestions on a draft created by the Environment Ministry. In response to that, the largest industry group representing the sector – the Consumer Electronics and Appliances Manufacturing Association (CEAMA) – has argued that higher costs of complying with tougher norms will inevitably push up final prices.

It has also asked the government to amend the rules which have proposed that companies collect and recycle a higher share of the e-waste generated by them. “In the current model, companies have to collect and recycle a predetermined percentage of annual product sales stretching back over the past 10 years, calculated from when the law kicks in. We have requested that the base value of calculation be brought down to sales of the previous year”, CEAMA spokesperson Rohit Kumar Singh told Business Standard.

High sales volumes meant that the gamut of proposed collection is large, currently beyond the recycling capabilities of most companies which have little to no infrastructure in place for the purpose, industry insiders said.

Current E-waste legislation is based on the Extended Producer Responsibility (EPR), which suggests that manufacturers have a moral and legal responsibility to dispose of and recycle e-waste generated by them from which they derive profit. Earlier, the government had broadly set the targets for recycling as fixed percentages of the quantity of waste generation by a company.

This time, it has suggested that producers recycle 10 per cent of the amount of waste they generated in 2017-18, following which the targets would increase by 10 per cent annually till 2023, when it hits 70 per cent. CEAMA wants this to be capped at 20 per cent.

In a letter reviewed by Business Standard, CEAMA has written to the Environment Ministry pointing out that it doesn’t agree with EPR norms which it says ‘are retrospective in nature and thus imposes a huge financial liability on producers’. “Schedule III in its current form be deleted, as there is a year-wise liability for past sales going back to 10 years.

Under prevailing accounting rules, any obligation of a retrospective nature must be accounted in the year from when the law takes place. This places an unimaginable financial burden on the company”, the letter said.

Concurrently, over the issue of new producers entering the market, the government has again clashed with the industry. The draft rules suggest that new producers may have to recycle 5 per cent of their sales figures till FY20, 10 per cent till FY22, 15 per cent till FY24 and so forth till 2025 when it will be fixed at 25 per cent of the previous years sales.

CEAMA has suggested that new companies be exempt from obligatory volume based targets for the first five years of their operating life after which the government model can be followed. “New producers may take some time to settle in and we want more in manufacturers to establish here with the Make in India initiative, so changes may be made to the draft,” a senior Environment Ministry official said.

According to industry estimates, only the Delhi-National Capital Region (NCR) is likely to generate about 1,50,000 metric tonnes (MT) of e-waste per annum by 2020, up from the current level of 85,000 metric tonnes.

The draft amendments have also proposed that the Central Pollution Control Board may conduct random sampling of electrical and electronic equipment placed on the market to monitor and verify whether companies are complying with provisions aimed at reducing use of hazardous substances. There has been opposition to the proposal on the grounds that there are no dispute resolution mechanism and we are looking into that, the official mentioned above said.