As per a report by the Energy and Resources Institute (TERI), India generates over 62 million tons of scrap waste every year. Out of this, approximately 45 million tons are recyclable. Additionally, India imports around 8.37 million tons of scrap metal every year, making it the world’s second-largest scrap importer. These numbers clearly highlight the profitability and sustainability of setting up a scrap business in India. There is a great demand and supply of scrap materials both in and outside the country. 

If this seems like a venture that you are passionate to be part of, let’s discuss how to start a scrap business or waste recycling business in India!

What is a Scrap Business?

A scrap business involves collecting, processing, buying and selling various types of scrap materials that can be recycled to make new products. These materials can include electronic waste, paper, plastic etc. 

As a scrap business owner in India, you play a vital role in reducing environmentally hazardous trash, thus benefiting the environment. A recycling business not only helps in reduction of waste but also promotes sustainable environment-friendly practices it is also considered as a profitable green business idea.  

In India, scrap metal dealers and merchants are the backbone of the business. They collect and sell old scrap metals so that they can be used again for different needs across different sectors.

Top Scrap Business Ideas in India

Here is the list of the best scrap business ideas in India.

Metal Scrap

Metal scraps can be collected from industrial plants, households, construction sites, etc. They can be easily melted, recycled and used for various purposes including making products like furniture or art.

Paper Recycling

 Paper recycling involves collecting paper from offices, schools and selling it to paper recycling plants or mills. These places then turn the old paper to create new paper products, which makes it a lucrative yet environment-friendly business idea. 

Plastic Scrap Business

Plastic is known to be the most hazardous material in the waste management system. It takes a long time to degrade them; however, if you recycle them, you can use them to make valuable products like containers or toys. 

E-waste Recycling

E-waste recycling refers to recycling of electronic waste. The processed materials can be sold to enthusiastic buyers who wish to create new and innovative electronic products. As recycling e-waste prevents the entry of harmful chemicals in our body as well as the environment, it is a wonderful green business idea. Moreover, the potential economic benefits that can be derived from this industry is also multifold!

How to Set Up a Scrap Business in India

Conduct Market Research

The first and most crucial step is to conduct extensive market research. Market research will help you to:

  • Understand demand for scrap materials in your area
  • Find reliable suppliers, buyers and customers for your business
  • Determine the best prices for your scrap materials

Researching the market and understanding the local regulatory requirements will help create a defined business plan. 

Licenses and Permits

There are legal procedures that you need to follow in order to start a scrap business in India. Necessary licenses and permits are required from the local authorities which may vary depending upon your specific location and the type of business one wants to start. Here are some of the licenses and permits one must obtain to start a waste recycling business in India. 

Secure Funding

Starting a scrap business may require multiple rounds of funding. Indifi is the solution for  funding your business, depending on how you want to expand or scale your business. Raising money for your business will help you to:

  • Purchase or rent the necessary equipment
  • Cover maintenance costs
  • Pay for salaries, wages and benefits of your workers
  • Expand your business in the future

To secure funding for your business, you can avail business loans from online loan providers like Indifi or partner with potential angel investors.

Build Network of Buyers and Sellers

The success of a scrap business depends on building a reliable network of buyers and sellers. In order to build a solid network, it is recommended to attend industry events, join trade associations and connect with other scrap dealers in your segment.

Invest in Equipment

Investing in the right equipment is crucial to start your scrap business. One should purchase equipment such as shredders, scales, containers, and more to process scrap materials. Apart from this, it is important to invest in a suitable location with ample storage space as well.

Instant Business loans for Startups

Challenges Faced By Recycling Businesses In India

Some of the major challenges faced by recycling businesses in India are:

  • Low Awareness:- Lack of awareness and participation among the public creates barriers to waste collection. Without active participation, recycling businesses in India struggle to achieve and maintain a substantial supply of recyclable materials. 
  • Limited Market Demand – With the gap in supply and demand of recyclable materials in the market, the growth potential of business is limited.
  • Lack of Updated Technology – Lack of proper technology affects the efficiency of recycling businesses. 
  • Lack of Infrastructure – Lack of proper infrastructure for waste collection and sorting affects the operation of recycling businesses. 

To address these crucial challenges, investment in recent technological equipment and policy reforms are vital, among other things. Market development and fostering partnerships with concerned stakeholders can skyrocket growth rate of recycling businesses in India.

Important Things to Consider Before Starting a Scrap Business in India

Like any other business venture, starting a scrap business requires careful planning and evaluation of various factors. Here are a few important considerations before starting a recycling business in India. 

  • Market research is crucial to starting any entrepreneurial venture. Know the demand for various types of scrap in your local area, identify potential consumers etc.
  • Obtain the necessary permits and licenses and understand the legal and regulatory requirements for starting your own scrap business in India. 
  • Establish a credible supplier chain to ensure consistent flow of materials.
  • In order to enhance business efficiency, it is important to stay abreast on technological advancements in your related scrap business. 
  • Plan your finances well that include initial investment, revenue projections, among other things.
  • Build a solid network within the industry as it can up doors for ample opportunities. 


To conclude, starting a scrap business in India is not only profitable but also contributes to environmental sustainability and protection, if done in the right manner. Being a scrap business owner, you have the opportunity to play a significant role in protecting precious natural resources by converting waste into valuable materials. 

All you have to remember is to conduct thorough market research, obtain licenses, secure funding from lending institutions and build a trustworthy network to increase the chances of your business’ success. 

By indifi

Leave a Reply

Your email address will not be published. Required fields are marked *