Circular economy builds economic resilience in turbulent times

In an increasingly unpredictable world, resilience has become as important as growth. Geopolitical tensions, resource constraints, supply chain disruptions, and climate change are reshaping the way economies and industries operate. The circular economy offers an opportunity not only to reduce environmental impact, but also to build more competitive value chains. It requires businesses to rethink products, materials, and their lifecycles as integrated systems rather than isolated processes.

In the present global environment, it goes without saying that we must change the way we produce, consume, and behave. This change must take place simultaneously at all levels: individual, municipal, national, and global. The private sector plays a key role. Across industries, businesses are demonstrating that circularity is not simply about managing waste, it is about redesigning value chains so that materials remain in productive use for as long as possible while creating economic value.

But circularity extends beyond recycling to recovering end-of-life materials and turning them into valuable feedstocks for new production. For instance, bauxite residue generated during the Alumina refining process is increasingly being supplied as an alternative raw material for the cement industry. Rethinking material flows across sectors can transform one industry’s by-product into another’s input, improving resource efficiency across sectors while reducing dependence on virgin raw materials.

As businesses mature in their circularity journeys, the opportunity extends beyond industrial by-products to designing entirely new circular value chains. Beyond industrial waste management, the next frontier of the circular economy lies in electronic waste, particularly as digital infrastructure, data centres, and clean energy technologies continue to expand.

At the turn of last year, India’s total live data centre capacity saw more than fivefold increase to over 1.6 GW from ~300 MW in 2016. The momentum is expected to continue. As India builds and expands its data centre infrastructure and AI development, it will be tasked with creating a parallel infrastructure that supports safe disposal and upcycling of e-waste especially AI-related hardware which typically has a far shorter commercial shelf life.

India and Finland, while different in geography and scale, share a common vision for advancing circular economy. The collaboration between Hindalco Industries and Finland’s Metso to establish India’s first integrated e-waste recycling facility is testament to this vision wherein critical minerals must remain in circulation rather than being continuously extracted and discarded.

Furthermore, circularity of critical resources enhances green energy and access to clean water, which in turn supports sustainable development. Prime Minister Narendra Modi and President Alexander Stubb agreed in March this year to a strategic partnership on sustainability between the two countries.

But moving into a circular economy does not happen overnight. It requires political commitment, supportive policies, incentives, intentional product and value-chain design, and roadmaps that formalise supply chains. It also entails the right kind of partnerships and first movers, who can pave the way to others.

What Finland can offer on India’s path towards circular economy

Finland pioneered the world’s first National Circular Economy Roadmap in 2016. A decade later through a strategic partnership rooted in sustainability, Finland is sharing its institutional knowledge and technical expertise that India needs to plan, and design closed loop, circular systems.

Finnish companies are already ensuring that the dialogue around circular economy is translating into action across India’s factory floors and production cycles. They are offering technological solutions to Indian companies and working with municipalities to design localised initiatives that support domestic demands.

Indian companies, too, are increasingly finding their voice across multi-lateral platforms which examine how materials can be optimally channelled across modern infrastructure to co-exist with extreme temperatures. The World Circular Economy Forum hosted for the first time in India by the Finnish Innovation Fund Sitra demonstrated the intention and rising appetite among businesses and policymakers to strengthen circular frameworks.

Heavy industries are India’s largest levers for decarbonisation and with circular economy cemented on reducing dependency across virgin materials, corporates will be a key linkage to accelerate the waste-to-value streams. Frugal innovation by leveraging technology will be most needed and visible across the hardest-to-abate sectors and in commercial and industrial operations.

The India–Finland Strategic Partnership on sustainability demonstrates what is possible when governments, businesses and innovators work together. Governments can create the enabling environment, but it is an industry that will scale solutions through investment,

innovation, and collaboration. In an increasingly resource-constrained world, circularity is no longer simply sustainability ambition—it is the foundation of resilient economies, competitive industries and enduring partnerships.

(Erik af Hällström is former Consul General of Finland; Deeksha Vats is Group Chief Sustainability Officer, Aditya Birla Group. Views are personal.)