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Opportunities in E-Waste Refurbishment under Electronics Repair Services Outsourcing Initiative 

20 Jun, 2023
Electronics Repair Services Outsourcing (ERSO)

The Union Ministry of Electronics & IT initiated the ERSO Pilot program to validate transformative policy and process changes intending to establish India as the Repair Capital of the World. The Electronics Repair Services Outsourcing (ERSO) initiative seeks to promote India as a central hub for repairing electronic goods and evaluate the feasibility of capturing 20% of the global repair service market within five years. India’s e-waste policy will undergo modifications to allow repair companies to domestically recycle 5% of imported goods by weight on a trial basis. The repaired goods will not be allowed to be sold in the domestic market, but provisions will be introduced to enable their exportation to regions other than their country of origin. The Ministry of Electronics & IT is the coordinating authority for this initiative.

Electronics Repair Services Outsourcing (ERSO) Pilot Initiative

India currently needs a strong industry for outsourcing electronics repair services. The global market for outsourced electronics repair services is valued at over $100 billion.

Importance of Electronics Repair Services Outsourcing

Importance of the Electronics Repair Services Outsourcing (ERSO) Industry for India:

  1. High repair costs in advanced countries such as Europe and the USA compel companies to send their goods to countries like India, China, and Malaysia, where labour costs are lower.
  2. The policy changes aim to create a robust domestic ERSO industry in India, generating an annual revenue of $20 billion and creating millions of jobs.
  3. The ERSO initiative will contribute to extending the lifespan of electronic devices worldwide by providing affordable and reliable repair services. India currently produces significant e-waste, with only 33% being processed, leading to environmental issues.
  4. A thriving ERSO industry will support Mission LIFE and greatly contribute to global environmental sustainability and the circular economy.
  5. Repair-based economic systems have higher employment rates compared to manufacturing-based ecosystems due to advancements in manufacturing technologies.
  6. Outsourcing repair services will incentivise electronic manufacturers to expand their production capabilities in India, fostering domestic manufacturing and strengthening the supply chain’s resilience.
  7. Streamlining the import-export process for faulty electronic products is necessary to expedite repairs and ensure timely clearances.
  8. Current e-waste rules pose challenges to the development of electronics repair and disposal regulations, hindering the effective management of non-repairable products and increasing logistics costs.
  9. Consumerism and limited access to repair services have led to a preference for replacement over repair when products become defective.
  10. Existing legislation makes it difficult for consumers to repair goods once the legal guarantee for the product expires.
  11. Relaxing import-export rules would facilitate the movement of repaired products across borders.
  12. Granting permission for re-exporting imported electronic goods to different countries would enhance flexibility.
  13. Relaxing e-waste rules would enable the recycling of 5% of imported goods domestically.

Concept of Electronics Repair Services Outsourcing (ERSO)

The Concept of the Right to Repair Framework:

  • The Right to Repair refers to the fundamental right of end users to repair or service the devices they own without facing restrictions from manufacturers. Its purpose is to encourage repair as a viable alternative to replacing devices.
  • Implementing the Right to Repair will enable consumers to have their products repaired at a reasonable cost instead of purchasing new ones.
  • It seeks to prevent manufacturers from imposing barriers that hinder consumers’ ability to repair their products, such as monopolistic practices, limited access to components and product manuals, and restrictions on third-party repairs.
  • The Department of Consumer Affairs has launched a Right to Repair portal where companies are required to provide information on self-repair manuals, authorized repairers, and third-party repair options for their products.

Forces driving the market demand for Refurbished electronics

Refurbishment can be defined as the process of bringing used e-waste up to a certain pre-determined quality and standard. Refurbishment may involve replacing worn and critical parts and aesthetically making the EEE look new. Brand new products are often in short supply due to issues like disruption in the supply chain or when demand surpasses the supply of the product. Refurbished EEE are gradually filling up this demand. Refurbished EEE also have an inherent advantage- they are cheaper. Consumers are increasingly becoming aware of the availability of quality EEE at lucrative prices through social media and online advertising.

Refurbished devices are gaining popularity as a lot of awareness is being created through media. As a result, many consumers, individuals, businesses, and institutions are expressing their willingness to opt for refurbished products.CPCB and SPCBs issue essential guidelines for the refurbishment process in e-waste from time to time. Specific infrastructural requirements and adherence to post-compliance are issued at the time of authorization by the board.

Licenses needed to start an E-Waste refurbishment business

Challenges in Implementing the Right to Repair Services

Challenges in implementing Electronics Repair Services Outsourcing (ERSO) are as follows:

  • Concerns raised by manufacturers: Manufacturers express concerns about data security, protection of intellectual property, and safety issues associated with unauthorized repairs.
  • Monopolistic policies of Original Equipment Manufacturers (OEMs): Companies often refrain from publishing repair manuals, making it difficult for customers to repair their products. They also exert proprietary control over spare parts, including design specifications for screws and other components.
  • Culture of planned obsolescence: Many products are intentionally designed to have a limited lifespan, requiring mandatory replacement after a certain period.
  • Technical and practical challenges: Encouraging repair-friendly product designs may present technical and practical difficulties for manufacturers.
  • Mandating the Right to Repair could increase the prices of electronic products.

Conclusion

The Electronics Repair Services Outsourcing (ERSO) initiative, launched by the Ministry of Electronics & IT, aims to validate transformative policy and process changes to establish India as the repair capital of the world. The significance of the ERSO industry for India is multi-fold. Firstly, it addresses the country’s lack of a robust electronics repair outsourcing industry. Major players in this industry are primarily based in China and Malaysia. By developing a domestic ERSO industry, India can tap into the estimated $100 billion global market and generate significant revenue. For businesses dealing with Electronics Repair Services Outsourcing (ERSO), it is recommended to take expert advice for better understanding and compliance.

FAQ

What is the benefit of electronic Repair Services Outsourcing (ERSO)?

The ERSO initiative promotes the extension of device life globally by offering affordable and reliable repair services for ICT products. This can help reduce the generation of electronic waste, which India currently struggles to manage effectively. The initiative contributes to global environmental sustainability and the circular economy by providing proper repair services.

What is the status of Electronics Repair Services Outsourcing in India (ERSO) and globally?

India currently needs a strong industry for outsourcing electronics repair services. The global market for outsourced electronics repair services is valued at over $100 billion, with major players like China, Malaysia, Flex, Lenovo, and Cisco.

What is Electronics Repair Services Outsourcing (ERSO)?

The Electronics Repair Services Outsourcing (ERSO) initiative aims to establish India as the global repair capital by validating transformative policy and process changes. Over the next five years, India’s ERSO industry aims for up to $20 billion in revenue to generate job opportunities.

What is the significance of Electronics Repair Services Outsourcing (ERSO)?

The significances are-
•Game changer for India to make India a world leader.
•Game changer for global sustainability towards the environment and the planet.
•It will enable to extend of a device’s life globally by providing cheap reliable repair.

What is the concept behind the right-to-repair framework?

The Right to Repair refers to the fundamental right of end users to repair or service the devices they own without facing restrictions from manufacturers. Its purpose is to encourage repair as a viable alternative to replacing devices.

Read our Article: Eligibility For E-Waste Auctions In India: Who Can Participate?

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