Voice of the Market

In March 2024, Upaya Social Ventures, with the support of Laudes Foundation, launched a Technical Assistance Facility (TAF) focused on Textile Waste Management. The TAF is designed to empower waste worker-first enterprises in India to effectively engage with textile waste and promote circularity in the fashion industry.

To achieve success, enterprises in this sector require dedicated support and impact-linked financing to establish and operate textile waste management systems. Through systematic market building, the TAF will provide these enterprises—and the millions of workers they employ—with the necessary skills, capabilities, infrastructure, and services to thrive.

Why focus on textile waste in India?

The textile and apparel industry contributes 2% to India’s total GDP, 12% of total exports, and employs over 45 million individuals. At the same time, 8.5% of the global textile waste or ~7800 kilotonnes is accumulated in India.

Of this, 51% of the waste is domestic post-consumer textile waste, 42% is pre-consumer textile waste, and balance 7% is imported post-consumer textile waste. Domestic post-consumer textile waste, the largest contributor to the country's total textile waste, is generated when consumers discard textiles due to reasons like changing fashion trends, wear and tear, damage, or outgrowing the items.

There are currently four ways in which textile waste is treated—recycling, reusing, downcycling, or sending it to landfills or for incineration. More than 50% of the domestic post-consumer textile waste is sold for reuse in the Indian domestic market. Recycling and downcycling textile waste is limited, and a large proportion (39%) gets diverted to incineration for energy and landfill. Most of the post consumer textile waste that is generated domestically and imported to India converges at Panipat, Haryana which is a major recycling hub in the north.

Realizing the opportunity in textile waste management

India has a well integrated, albeit unorganized industry to deal with textile waste leading to informality and difficulties in traceability of waste. The value chain also employs a large workforce. However, to realize the potential of textile waste in India, few bottlenecks need to be overcome like:

• Ineffective textile waste management systems
• Unorganized and informal textile value chains
• Inefficient realization of textile waste potential
• Challenges around worker wellbeing

Collaborations among responsible waste management enterprises, capital providers, and ecosystem enablers is the way forward to further strengthen the textile waste management market in India. This will foster a circular economy, enabling well-being and a just transition for workers in the sector.

Upaya’s Technical Assistance Facility

Upaya’s TAF aims to bring together capital, knowledge, networks, and technology to support deep impact, high potential textile waste management enterprises in India working with post-consumer textile waste.

• Capital: Concessionary capital will be provided to high potential waste management enterprises to set up textile waste management units. The companies will be incentivized to achieve business, social, and environmental impact through an impact-linked finance structure which we are designing along with Sagana Advisory.

• Knowledge: Waste management enterprises will be provided access to knowledge resources and expertise to approach textile waste value chain with our technical partners Fashion For Good (FFG).

• Technology: Enterprises will also be provided access to technology to solve challenges in managing textile waste.

• Networks: Global and in-country networks will be leveraged to effectively achieve outcomes.

By taking a worker centric approach, the technical assistance facility has been designed to drive meaningful outcomes for the sanitation workers, environment, and enterprise partners.

Sanitation Workers:
Sanitation workers will benefit from a new income generating avenue, dignified jobs and a safe work environment, and upskilling opportunities. Workers will experience just transition from unorganized and informal textile waste value chains through fair, equitable, and inclusive means

Environment:
Through recycling and reuse of textile waste, there will be a reduction in the quantity of textile waste ending up in landfills and this will also contribute to the conservation of resources.

Enterprise Partners:
Waste management companies will gain an additional revenue stream through the establishment of a financially sustainable textile waste management unit, working as agents of change to create positive social and environmental impact.

Please reach out to us at [email protected] to learn more about the TAF and for potential collaboration opportunities, including partnerships, investments, or knowledge-sharing initiatives.

You can also visit our website to read more about our Technical Assistance Facility.