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Advancing India’s self-reliance: Enhancing circularity in used oil management

The used oil ecosystem in India has long been characterised by fragmentation and informal practices, with significant volumes of used oil often lost to inefficient processes and improper disposal.

To drive a focused and collaborative effort towards transforming India’s used oil recycling ecosystem, Deloitte India, the Federation of Indian Chambers of Commerce and Industry (FICCI) and the Resource Efficiency and Circular Economy Industry Coalition (RECEIC) collaborated to launch a thought paper on “Advancing India’s self-reliance: Enhancing circularity in used oil management” aimed at reinforcing the country’s commitment to resource efficiency and economic resilience.

Systemic barriers/challenges in India's used oil ecosystem

Despite a growing awareness of the environmental and economic benefits of recycling used oil, the current system remains heavily reliant on informal networks, presenting significant challenges to efficiency, compliance and sustainability. Here are a few key challenges:

Strategic recommendations for a sustainable used oil ecosystem 

The recommendations outlined herein are designed to drive the transformation of the used oil ecosystem in India by overcoming the challenges through a comprehensive approach:

Establishing a national used oil management association

Strengthening the collection ecosystem and supply chain

Incentivising the inclusion of Re-Refined Base Oil (RRBO) in lubricant formulations

Enhancing G1 re-refining capacity and adding G2 capacity

Improving RRBO quality and market acceptance

These measures form a strategic roadmap that not only supports environmental sustainability but also enhances economic resilience by optimising resource utilisation and reducing energy consumption.

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