Representative image. Source: Freepik

India’s push towards a circular economy is increasingly extending beyond metals, plastics, and textiles into the farm sector, as policymakers seek to reposition agricultural waste as a strategic resource rather than an environmental liability.

A recent government press release highlights that India generates around 350 million tonnes of agricultural waste annually, spanning crop residues, livestock manure, and post-harvest food losses. Poor handling of this biomass — particularly through open burning and landfill disposal — contributes to air pollution, greenhouse gas emissions, and declining soil health, while also representing a significant loss of recoverable economic value.

Large untapped potential in biomass utilisation

According to official estimates, agricultural residues could support bioenergy generation potential of more than 18,000 MW per year, alongside enabling the production of organic fertilisers and soil conditioners that can reduce dependence on chemical inputs.

Waste occurs at multiple stages across the farm-to-food value chain — from harvesting and storage to processing, distribution, and consumption. Addressing these leakages through improved logistics, aggregation mechanisms, and processing infrastructure is therefore seen as central to building viable circular value chains.

Technologies such as compressed biogas production, biomass densification, and engineered biochar are being promoted as scalable solutions that can convert farm waste into marketable products while contributing to carbon sequestration and soil regeneration.

Policy measures target residue management and infrastructure

The government has rolled out several programmes aimed at improving the utilisation of agricultural waste. Under crop residue management initiatives, financial assistance has supported both in-situ solutions, such as mulching, and ex-situ applications, including biomass collection and processing.

Between 2018-19 and 2025-26, over ₹3,900 crore has been released to key states, enabling the establishment of more than 42,000 Custom Hiring Centres and deployment of over 3.24 lakh crop-residue management machines to discourage stubble burning and promote sustainable practices.

Similarly, the GOBARdhan scheme is facilitating the conversion of cattle dung, agricultural residues, and organic waste into compressed biogas and organic manure. As of January 2026, 979 biogas plants were operational across more than half of India’s districts, indicating the gradual formalisation of decentralised biomass recovery systems.

Complementary financing support is being provided through mechanisms such as the Agriculture Infrastructure Fund and the Animal Husbandry Infrastructure Development Fund, which are enabling investments in storage, processing, and waste-to-value facilities across rural supply chains.

Circular agriculture linked to growth and climate goals

Officials note that scaling such interventions could help India simultaneously address food waste, rural income volatility, and energy security concerns, while contributing to emissions reduction targets. Globally, food waste exceeded 1 billion tonnes in 2022, underlining the importance of systemic resource-efficiency strategies.

India’s broader circular economy transition — projected to potentially reach $2 trillion in market value and create up to 10 million jobs by 2050 — is therefore expected to increasingly depend on how effectively agricultural material flows are captured, processed, and reintegrated into productive use.