Turning EU’s DPP into India’s global green breakout

In the 1970s, Japanese automakers were not even challengers in a US market dominated by Detroit’s gas-guzzlers. Then came the oil crisis. Fuel prices surged and American consumers began craving efficiency. Japan seized the moment — reimagining cars for America to be smaller, smarter and more fuel-efficient. It was not just a response to a crisis; it was a breakout.

South Korea charted a similar path in the 1990s. Facing economic turmoil after the Asian Financial Crisis, it doubled down on tech-driven reforms. With massive investment in digital infrastructure and innovation, Korea transformed from a manufacturing follower into a global technology powerhouse.

India showed what is possible with the right infrastructure. The Unified Payments Interface (UPI) didn’t just digitise finance — it built a foundation for scalable, inclusive innovation.

Today, India stands at a similar inflection point. The EU’s Digital Product Passport (DPP) mandate could be a disruption — or a springboard to global leadership in sustainable, digital trade.

EU’s green trade disruption

The European Union’s Circular Economy Action Plan (CEAP) is setting new rules for global commerce. Under its Eco-design for Sustainable Products Regulation (ESPR), the EU will require Digital Product Passports for many products entering its market.

DPPs are digitally accessible records — typically accessed via QR code — that contain granular information on a product’s origin, composition, environmental impact, reparability and end-of-life handling.

The benefits expected are increased consumer trust, improved supply chain management, enhanced circular economy and reduced environmental impact.

This rollout begins with sectors like batteries, textiles and electronics, and will soon expand to chemicals, metals, furniture, tyres and more. Any product entering the EU must comply with the legislation — even if manufactured outside Europe.

Why it matters for India

The EU is India’s largest export destination, accounting for over 21 per cent of merchandise exports — worth more than $98 billion in FY25. Crucially, many of the sectors targeted in the DPP’s initial roll out — textiles, iron and steel, aluminium, chemicals, footwear and leather products — are India’s strongest export performers.

India’s exposure is already unfolding in the two sectors facing the earliest DPP compliance deadlines: batteries by 2027 and textiles by 2028. In FY24, though India exported only a relatively small value — about $90 million — of batteries, textiles amounted to $10 billion to the EU. Textiles, we are aware is a sector where India holds a globally competitive position.

These sectors must meet DPP requirements — or risk market exclusion. Without alignment, Indian exporters face compliance bottlenecks and reduced market access in one of the world’s most sustainability-conscious economies.

If met with ambition, the DPP mandate could propel India into the vanguard of sustainable, digital manufacturing.

Export competitiveness: Complying early, ensures continued EU access while branding India as a responsible, forward-looking trade partner.

Supply chain digitisation: DPP compliance demands machine-readable data across fragmented supply chains. This push will accelerate digitisation, boost traceability and unlock operational efficiencies — especially in complex sectors like textiles and electronics.

Circular economy integration: DPPs force sustainability into product design, production and disposal. This supports India’s transition to circular manufacturing, complements EPR policies and aligns with climate goals.

Smart regulation: Digital traceability enables real-time and remote enforcement. Agencies like BIS and CPCB can verify standards without significant manual intervention — enhancing speed, scale and transparency of enforcement, while raising India’s credibility as a rule-abiding exporter.

Green tech leadership: Early adoption of DPP standards can put India at the forefront of sustainable digital trade — especially among emerging economies. It is an opportunity to future-proof our industries.

Infrastructure imperative

Achieving this vision requires more than just compliance by large firms. MSMEs, which dominate India’s exports, will struggle without shared tools, frameworks and support.

The most transformative solution lies in the creation of a Digital Public Infrastructure (DPI) for DPP, modelled on India’s landmark success on digital payments. A common digital backbone would provide standardised data templates, secure APIs, consent-based access and authentication, integration toolkits for ERP systems and centralised product registries.

This would level the playing field, enabling every Indian manufacturer to participate in global sustainable trade — regardless of size or digital capability. India is already seeing innovation from the private sector, but it is likely that early platforms would serve large, formal-sector firms. MSMEs still face cost, capability and connectivity barriers.

A government-backed DPI would bridge this gap and drive inclusion.

To build momentum, India could launch pilot projects in high-priority sectors and export hubs, such as textiles, electronics, chemicals and iron and steel — which are not only part of the EU’s initial rollout, but also among India’s top merchandise exports to the region.

These pilots can be anchored in leading export clusters such as Tirupur for textiles, Noida for electronics, Vapi for chemicals and Jamshedpur for iron and steel.

These pilots should engage select exporters, regulators and tech providers to test data capture, interoperability and ERP integration. The lessons learned will inform national policy, refine technical standards and ease the onboarding of MSMEs.

Coordinated action

India’s DPP push must ensure close working of critical Ministries: the Ministries of Commerce, MSME, Environment, Electronics & IT and Textiles.

A high-level task force could develop sector-specific DPP roadmaps, support public-private platform development, coordinate with industry bodies like CII and EEPC and mobilise state export councils for local outreach.

Institutions like the Quality Council of India must drive standard-setting and capacity-building across the value chain.

Like Japan in the 1970s or South Korea in the 1990s, India today faces a moment of external pressure, that could catalyse an internal transformation. India must see this is a chance to lead— by building open, inclusive, scalable infrastructure for sustainable trade.

By laying the digital rails now, India can empower its manufacturers to compete and lead in the global green economy. More importantly, it can create a replicable global standard in digital sustainability tools — positioning itself not just as a participant in the green transition, but as its architect.

Before the Digital Product Passport becomes a gatekeeper, let it become our gateway to a global green future, eventually becoming one more pillar to our dream of a Viksit Bharat @ 100.

Sondhi, Chairman National Board for Quality Promotion, QCI and former MD & CEO, Ashok Leyland & JCB India; Aamir is Policy Analyst, QCI

Published on June 6, 2025

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