Naturo Earth, a skincare and personal products company, aims to make its products as zero-waste as possible. But sustainability comes at a cost. When the brand switched its soap packaging to biodegradable paper made out of elephant faeces, their costs shot up, according to Aryan Rungta, the company’s marketing head.

“If you use any other paper [for packaging], it’s really cheap,” Rungta said. “But once we use the elephant poop paper, the cost goes really high.”

Other environmentally conscious companies in Nepal must also face a tradeoff between price point and sustainability.

Businesses in general operate with a linear business model: when a product reaches the end of its life, the consumer throws it away. But the Wildlife Conservation Nepal and Impact Hub’s project ‘Roots of Circularity’ hopes to introduce circular business practices—in which all products are reused or recycled by the original manufacturer—to Nepal’s economy.

At the first Conclave on Circularity in Nepal, Roots of Circularity brought together small businesses, policymakers and students to discuss how Nepal’s economy can transition from a linear business model to a circular one.

“I want this to be the norm,” the Conclave’s director Sanjeevani Yonzon told the Post. “I want a circular economy not to be an alternative—a utopian word that only environmentalists talk about—but it should be grounded in reality, because a circular economy is essential.”

With education from Roots of Circularity, a group of small businesses in Nepal are working to adopt a circular business model. As Rohan Shrestha, programme officer at Impact Hub Kathmandu, explained in his presentation at the event, in a circular economy, instead of buying products, consumers lease products—such as clothes or kitchen appliances—from a company, and then return the product to the company when it is worn out or no longer needed.

The businesses attempting to adopt a circular model of production face the challenges of higher costs as they compete with cheaper imported goods, and the small market for sustainable goods.

All the business owners who aim to make their products sustainable understand that environmental consciousness takes more time, resources, and money.

“All the green products are facing this problem,” Pravesh Panthi of Green Decision Labs and Research said. The group develops innovative solutions to increase urban sustainability, such as their ‘Zero Circular’ biodegradable plastic made from corn.

Right now, their biodegradable plastic is on average more expensive than typical plastics made from fossil fuels. However, Zero Circular is currently working to reduce their costs by sourcing their biomass materials domestically, rather than importing agricultural waste from India, Anima Piya, co-founder and director of operations at Zero Circular, told the Post.

ReKriti, a company that uses denim textile waste to make bags and wallets, also struggles to sell its products in a market where consumers often choose cheaper, less sustainable options.

“We always get compared to the products imported from China, because they are of a really low price, and [customers] expect our products to come at that price,” ReKriti co-founder Nasana Bajracharya said. “But it's pretty impossible for us to sell [our products] at that price because of all the extra work that goes into recycling.”

ReKriti offers repairing for all of their products, and they send any scraps they cannot use to be shredded and recycled into products like blankets.

ReKriti sells its bags within the small market of people willing to pay slightly more for a sustainable product. They hope to expand their customer base through more awareness about circular business practices.

“We cannot grow our company until and unless we raise awareness regarding our advocacy and our brand,” Bajracharya said.

As Panthi of Green Decision Labs and Research noted, the more people that use sustainable products, the more affordable these products will become because companies will be able to expand their production to a larger scale. “If everyone uses the biodegradable bags, then I think it will cost a similar amount to regular plastic,” he said.

Panthi also thinks that policymakers can play a role in incentivising circular business models. Specifically, Panthi suggested that the government levy taxes on imports and invest in domestic sustainable manufacturing to help Nepal’s small, circular businesses compete with cheap imports.

Wildlife Conservation Nepal Director Yonzon agrees that the government should support circular businesses.

“The solution is making the government push a little bit—incentivise the companies that are [operating sustainably],” Yonzon said.

Yonzon argues that to help transition Nepal’s economy to a circular model, policymakers must take into account the country’s well-being outside of its GDP alone. “We are trying to bring sustainability to GDP—GDP does not consider what is good for the environment,” she said. “No price is too big for a healthy environment.”

Narayani Rana, an Environmental Science student at Kathmandu University who attended the event, believes that the goal of circularity is viable but sees many challenges in its implementation.

“It sounds really nice, but in real life, it is really hard [to achieve],” Rana told the Post. “It’s a good initiative but it’s hard practically.”

Rana also pointed out that many products manufactured in Nepal already use imported materials. “If you are just stitching it in Nepal but the whole product is foreign, how is that going to become circular?” she said.

Panthi of Green Decision Labs and Research thinks that using indigenous technology and local resources can help Nepal’s industry transition to a more circular business model.

“If you see from Nepal, I think the resources that favour us more, if we can use those things, then it will be the best,” Panthi said, referencing Nepal’s natural resources like hydropower.

A future challenge for Roots of Circularity will be bringing circular business practices to bigger industries in Nepal. As Shrestha, the Impact Hub programme officer, explained, implementing circular business practices within a long-established company is more challenging than in a company still in the process of developing its production.

“[Big companies] already have channels producing the consumer segments, everything lined up where they are making profits,” Shrestha told the Post. “From their point of view, it would be like, how will [circularity] bring more profit?”

Amod Karmacharya, whose company, Bhoomithan, sells rope incense made from recycled flowers, said that he felt hopeful that bringing together the different actors at the Conclave would help more businesses adopt circular production.

“Change comes from the policy level, from students, and from hope,” he said. “These criteria are present—so I would say it was fruitful,” Karmacharya said of the Conclave.