Why are Samsung and LG taking the Indian Government to Court?
Samsung and LG have filed a legal challenge against the Indian government over a controversial new rule meant to clean up the country’s electronic waste (e-waste) crisis. At the centre of the conflict is a regulation that mandates electronics manufacturers to pay a fixed INR 22 per kilogram to certified recyclers. This law, while designed to reform India’s chaotic and hazardous e-waste management system, has instead triggered a legal showdown. India is currently the world’s third-largest producer of e-waste, after China and the United States. Each year, the country generates over 3 million tonnes of discarded electronics, ranging from obsolete phones and broken laptops to outdated televisions and refrigerators. However, less than half of this waste is processed through formal recycling channels. The rest is handled by an unregulated informal sector, concentrated in hubs like Seelampur near Delhi.
Seelampur represents the harsh underbelly of India’s tech revolution. Here, entire communities, including children, earn a meagre living dismantling gadgets by hand. Toxic methods, such as acid baths to recover metals and open-air burning of wires, expose workers to dangerous chemicals like mercury and lead. Despite the health risks and environmental damage, these practices persist, largely because they’re the cheapest and fastest way to recover valuable materials. To tackle this hazardous ecosystem, the Indian government introduced updated e-waste rules in 2022, which became fully enforceable in 2023. The cornerstone of this policy is Extended Producer Responsibility (EPR). Under EPR, electronics producers are held accountable for the collection and safe disposal of waste generated from their products.
What changed in late 2024 was the imposition of a mandatory payment rate of INR 22 per kg to certified recyclers. Companies like Samsung and LG are arguing that this inflexible pricing model severely inflates their costs by as much as 5 to 15 times in some cases, and fails to address the real structural issues plaguing India’s recycling system. Before this regulation, manufacturers had the freedom to negotiate lower rates with recyclers, often paying INR 5-6 per kg. In many cases, waste was informally handed down the line to low-cost dismantlers who operated outside the formal economy. The government claims this undercut pricing encouraged unsafe practices and left formal recyclers with no competitive edge. By setting a price floor, the aim is to make regulated recycling financially viable and discourage environmentally harmful shortcuts. But critics argue that the policy is out of step with on-the-ground realities. India’s formal recycling industry is still in its infancy, with limited infrastructure and capacity. Most of the actual e-waste collection and dismantling is still done informally, over 90%, according to a 2024 report by ICRIER. Registered recyclers often rely on this informal network to receive dismantled waste.
The new law, however, completely bypasses this informal workforce. Payments are restricted to CPCB-approved recyclers, leaving out the kabadiwalas, waste pickers, and informal dismantlers who move most of the waste. Companies are effectively being asked to pay a fixed price into a system that doesn’t yet fully exist. Adding to the confusion is the role of Producer Responsibility Organisations (PRO), intermediaries meant to help companies fulfil their EPR targets. These entities operate within a poorly defined and opaque credit system, and often fail to bridge the gap between the formal and informal sectors. Other countries handle this issue differently. In the US, e-waste policies vary by state. Manufacturers often negotiate directly with recyclers or contribute to recycling programs based on sales, without any fixed per-kilo pricing. In China, the government collects recycling fees from companies and subsidises approved recyclers, ensuring standardised waste treatment without forcing direct manufacturer-recycler payments. Both systems have their drawbacks — the US lacks uniformity, and China’s model suffers from bureaucratic inefficiencies, but neither imposes rigid pricing structures like India.
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