Plastic is everywhere..we are drowning in waste and it has huge health implications. It is not acceptable. The government has introduced the extended producer responsibility (EPR) under which almost all manufactures, importers and brand owners have 100 per cent collection target and as per records, the country has recycled 4-5 years of all the plastic waste it has produced. The revenue is equal to 4 Chandrayaan missions. So, what is happening..why then do we still see plastic waste? Let’s do a little deep dive into this EPR system and what is is adding up to, or not.
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Let’s explore plastic and why the waste is everywhere, despite the EPR system and what then needs to be done
India has recycled 17 million tonnes of plastic packaging waste since 2022, when the Extended Producer Responsibility (EPR) regime came into force, according to latest data from the Central Pollution Control Board (CPCB). If we estimate the value of this plastic recycling trade it is a whopping Rs 2500 crore (or Rs 25 billion). Just so that we understand this number, it is equal to funding four Chandrayaan-3 Moon missions.
Consider also CPCB estimates that India produces some 3.8 million tonnes of plastic waste each year. In other words, we have been widely successful in collecting, recycling and getting rid of at least 4-5 years of plastic waste generated. But if this is the case, and it clearly is, based on official documents of June 2026, then why do we as Indians continue to see huge mountains of plastic waste growing in all our cities; in our riverways and in our villages. Why has plastic become the menace it has? Why?
Clearly, there is something not quite right, to put it mildly
The ERP is an instrument, used universally, to manage waste. It puts the onus on producers of plastic, who could be manufacturers, importers or brand owners. These are collectively called PIBOs and as of 2023-34, in India, these companies are mandated to collect 100 per cent of the waste they generate.
As of last year, that is 2025-26, PIBOs had to recycle between 40-60 of this collected packaging material. And as of this year 2026-27, this target is up to 50-70 per cent depending on the category of plastic material. So, for instance, PIBOs of category 2 plastic, which includes everything from single to multilayered packaging, carry bags and sachets – or everything that we consume from chips to shampoo sachets – are mandated to collect 100 per cent of their products and recycle 50 per cent as of this year.
To meet their EPR target, PIBOs do contracts with plastic waste processors (PWPs) – recycling units, which are required to be registered with CPCB. There are some
1000 registered PWPs, according to official data. The PWPs, get paid for collection and recycling, based on rates that have been mandated by CPCB.
These rates range from Rs 870 per tonne for category 1 (PET bottles and the like), Rs 1500 per tonne for flexible plastic (packaged food and other household items) to Rs 2500 per tonne for carry bag of compostable material. Each tonne of plastic recycled in equal to one EPR certificate.
The value of these 17 million EPR certificates, which have been generated from 2022 to mid 2026, is calculated based taking an average rate of Rs 1500 per tonne and this comes to Rs 2500 crore. If PIBOs, do not meet their targets for recycling then they are charged a hefty environmental compensation charge.
This cost of non-compliance is 2.5 times the cost of compliance. CPCB estimates that the cost of plastic waste recycling is Rs 4000 per tonne, which it then distributes equally between municipalities and producer companies, averaging Rs 2000 per tonne. If they fail, then they get slapped EC of Rs 5000 per tonne for category 2, for instance.
All sounds great. In fact, so good that it is now being said that government is thinking of taking this system to the stock market so that these certificates can be traded. Brilliant market thinking for smart governance, you could argue.
But then, I ask again, if this system is working so well, why do we see so much plastic everywhere. My colleagues audited plastic in the drains of Agra city and they found – not surprising – branded plastic packaging waste made up 70 per cent of the collected plastic – all under the EPR regime. You can do the same or just look out of for window. The packaged waste, mandated for 100 per cent collection and 50-70 per cent recycling is on our roads; in our lakes; in our open spaces. So how can companies claim 100 per cent collection? How can it be said that 5 years of plastic waste has been removed? How?
Let’s look at what can go wrong? First, does the PIBO target underestimate the amount of waste that is generated? In 2024, my colleagues analysed data from the official EPR portal and found some 41,544 PIBOs had registered and had been given targets for recycling based on self-reported data. How this was validated is not clear.
Second, there is the million-rupee question of how CPCB will verify how much waste has been processed and recycled. It says it does this through audits and ground-checks, but not much is known about what was found or corrected. On June 26th, it has issued directions to different states for action against non-compliant PWP’s – it suggests that audit found PWP’s were generating certificates more than the capacity of the registered plants and other serious violations.
The problem is compounded because it is difficult to trust or verify in this business. CPCB states that PWPs must upload GST invoice as proof of sale of the finished recycled product. This, in most cases, would be pellets – plastic is sorted, heated
and melted to make this product which is then used by different industries. In most cases these user industries would work in the informal sector. Worse, the high cost of GST, at 18 per cent makes open business unviable.
The third issue is even more fundamental. It costs PIBOs 2.5 times more to pay for non-compliance; it means that they should want to pay for recycling at the PWPs. But it also creates a perverse incentive to ‘arrange’ for certificates and not for recycling. This is also because in many cases, recycling is not feasible at the agreed rate. Our research finds real cost of recycling of that same category 2 plastic would be between Rs 4000-6000 per tonne -- much higher than the set price of Rs 1500 per tonne.
So, what is the real proof that waste is being collected and it is being recycled and processed. The only proof in this pudding is the quantum of uncollected plastic waste in our vicinity.
We need the EPR system to work for management of plastic waste and for this we need more more ways to improve scrutiny, compliance and verification. This means more openness and more learning.
But the reverse is happening. As of June 28, 2026, the EPR portal has gone dark. It is now available only to a closed group of users. It can be argued that this because this is now a lucrative business and private information must be kept confidential. But I believe this lack of transparency will only make things worse, not better. In this way certificates will be issued – huge money will exchange hands – and we will continue to drown in plastic waste. This is not governance for tomorrow, not even yesterday.