Title: Implementing circular economy practices in Indian SMEs: analysis of challenges with case study

Authors: Sandeep Kumar; Ravinder Kumar; Rakesh Kumar Phanden; Rajeev Rathi

Addresses: Department of Mechanical Engineering, Amity School of Engineering and Technology, Amity University Uttar Pradesh, Sector 125 Noida – 201303, India ' Department of Mechanical Engineering, Amity School of Engineering and Technology, Amity University Uttar Pradesh, Sector 125 Noida – 201303, India ' Department of Mechanical Engineering, Amity School of Engineering and Technology, Amity University Uttar Pradesh, Sector 125 Noida – 201303, India; Federation University Australia, P.O. Box 663 Ballarat VIC 3353, Australia; Sat Kabir Institute of Technology and Management, VPO Ladrawan, Bahadurgarh, Haryana 124507, India; Institute of Health and Management, Level 2/187 Boundary Rd, North Melbourne VIC 3051, Australia ' Department of Mechanical Engineering, National Institute of Technology Kurukshetra, India

Abstract: The adoption of circular economy (CE) and its practices is still in a nascent stage in Indian SMEs, irrespective of various initiatives, policies, and transnational strategic partnerships. Existing research has outlined the benefits of CE adoption in Indian SMEs to achieve sustainable business performance in emerging markets. This paper has identified the challenges of CE in Indian SMEs. The fuzzy DEMATEL approach is used to prioritise the challenges of the CE in Indian SMEs. The robustness of model and expert's biases is checked by sensitivity analysis. The analysis shows that the lack of legislation and regulation, systemic nature of CE, multi and interdisciplinary nature of CE are the top causing challenges. Similarly, the lack of affordable waste management techniques, non-availability of reverse logistics facilities and lack of in-house technological capabilities on CE are top effect challenges. Based on classification and prioritisation from fuzzy DEMATEL techniques, the organisations can form strategies and make a transformation toward circular practices. Observations from the case study state that internal technological facilities and training can also help in the journey of implementing CE practices. To get a practical insight into CE implementation, we have conducted a case study on windshield manufacturing organisation.

Keywords: linear economy; circular economy; CE; Indian small and medium enterprises; Industry 4.0; case study; India.

DOI: 10.1504/IJAOM.2025.145197

International Journal of Advanced Operations Management, 2025 Vol.16 No.1, pp.35 - 59

Received: 30 Jun 2023
Accepted: 23 Mar 2024
Published online: 25 Mar 2025 *