How to Set Up a Tyre Recycling Plant in India: Licenses, Cost & Profit Analysis

Introduction — From Pile of Tyres to Profitable Green Business

A few years ago, Arjun, a mechanical engineer from Pune, drove past a dumping yard every day on his way to work. Mountains of old tyres were piled high, collecting rainwater and releasing toxic fumes when burnt. One day, he decided to dig deeper. Within months, he discovered that every used tyre could be reborn — as fuel oil, carbon black, or steel wire — if processed the right way.

Today, Arjun runs a successful tyre recycling unit that not only earns steady profits but also saves thousands of tyres from ending up in landfills. His story is a reminder: sustainability and profitability can go hand in hand — provided you start with proper planning, compliance, and licenses.

This guide walks you through every practical detail — from approvals and setup cost to profit projections and risks — so you can confidently launch your own tyre recycling business in India.

Why Tyre Recycling Matters More Than Ever

India discards nearly 3 million tonnes of waste tyres every year. Earlier, much of this waste went to illegal burning or unscientific pyrolysis, causing air and soil pollution. In 2022, the Ministry of Environment, Forest and Climate Change (MoEFCC) and Central Pollution Control Board (CPCB) brought in new EPR Rules for Waste Tyres, mandating every producer and recycler to register and account for tyre waste scientifically.

For entrepreneurs, this is not just a regulatory requirement — it’s a massive business opportunity.

Market signals are clear:

• India’s tyre recycling market is projected to grow from ₹18,000 crore (2024) to ₹25,000+ crore by 2030.
• The government’s circular economy mission has made waste-to-resource industries eligible for easier credit and subsidies.
• Global demand for Recovered Carbon Black (rCB) and Tyre Pyrolysis Oil (TPO) is rising, especially from cement, steel, and rubber manufacturing sectors.

In short, every tyre you recycle helps meet India’s sustainability targets — while adding value to your bottom line.

Step 1: Understand the Business Model

Before rushing to buy equipment, pause and map your business model.

There are three main routes in tyre recycling:

• Crumb Rubber Manufacturing: Mechanical shredding of tyres into granules (used in roads, playgrounds, and sports surfaces).
• Pyrolysis (Thermochemical Conversion): Tyres are heated in a reactor to produce oil, carbon black, and steel wire.
• Devulcanization & Reclaim Rubber: Used tyres are chemically treated to make new rubber sheets.

Each route has a different compliance path, machinery cost, and market. For instance, pyrolysis requires stricter pollution-control equipment but offers faster payback through EPR credits.

💡 Expert insight: Start with pyrolysis or crumb rubber if you’re entering the industry. These two processes have proven markets and easier scalability.

Step 2: Licenses and Authorizations — The Legal Backbone

Setting up a recycling plant without the right permissions can shut down your business before it even begins.

Here’s what every investor or founder must secure:

Core Licenses Required

• Company Incorporation: Register your business entity (Private Limited, LLP, or Proprietorship).
• Land Use Approval: Ensure the land is in an industrial zone; agricultural land use is prohibited for such operations.
• Consent to Establish (CTE): Approval from the State Pollution Control Board (SPCB) to construct the plant.
• Consent to Operate (CTO): SPCB’s approval to start production after setup.
• Hazardous Waste Authorization (Rule 9): For using or processing end-of-life tyres under the HOWM Rules, 2016.
• CPCB EPR Registration: To sell EPR certificates on the national waste-tyre portal.
• Factory License: Issued under the Factories Act, 1948, for worker safety and inspection.
• Fire NOC & Boiler License: Local Fire Department and PESO approval if you use pressurized systems or oil storage.

Most delays happen when founders file CTE and CPCB applications separately. File both together — it can save nearly a month.

Table 1 – Mandatory Licenses for Tyre Recycling Plant

License / NOC	Issuing Authority	Typical Validity	Avg. Approval Time
Consent to Establish (CTE)	State Pollution Control Board	5 years	45–90 days
Consent to Operate (CTO)	State Pollution Control Board	5 years	30–60 days
EPR Recycler Registration	Central Pollution Control Board	1 year (renewable)	30 days
Hazardous Waste Authorization	SPCB / MoEFCC	5 years	45 days
Factory License	Labour Department	Annual	10–15 days
Fire NOC	Local Fire Dept	3–5 years	7–10 days

A clean layout plan, correct emission-control drawings, and complete application files drastically reduce rejections.

Step 3: Selecting the Right Technology & Machinery

Your technology defines not just your efficiency but also your regulatory comfort.

When comparing machinery, focus on these practical questions:

• Is it batch-type or continuous? (CPCB allows only continuous pyrolysis systems).
• Does it come with an Air Pollution Control System (APCM) — condenser, scrubber, and gas cleaning unit?
• Has the supplier provided emission data tested by NABL-accredited labs?
• What’s the energy consumption per tonne? (Electricity + fuel can form up to 40 % of monthly operating cost).

Pro-tip: Choose suppliers who have supplied equipment to already-approved plants. They understand emission norms and layout expectations from SPCB inspectors.

Step 4: Tyre Recycling Plant Cost & Profitability

Let’s bring numbers to life. Suppose you plan a 10 TPD continuous pyrolysis unit.

Table 2 – Indicative Financial Snapshot (10 TPD Plant)

Cost Head	Estimate (₹ Lakhs)
Land & Civil Work	40 – 60
Machinery + Installation	100 – 150
Pollution Control System	25 – 35
Electrical & Utility Setup	15 – 20
Working Capital (3 months)	40 – 50
Total Project Cost	220 – 300 Lakhs
Monthly Revenue (Avg.)	35 – 45 Lakhs
Breakeven Point	24 – 30 months

Typical Output from 1 tonne of tyres

• 35 – 40 % Tyre Pyrolysis Oil (TPO)
• 35 – 40 % Recovered Carbon Black (rCB)
• 10 – 15 % Steel Wire
• 5 % Gas Fuel (returned to the reactor)

Each tonne of processed tyre also generates one EPR certificate, tradable with producers who need to meet their recycling targets.

Step 5: Making Sense of the EPR Credit System

EPR (Extended Producer Responsibility) may sound complex, but think of it as a reward system for recyclers.

Here’s how it works in practice:

1. You register as an authorized recycler on the CPCB EPR portal.
2. Each tonne of waste tyres processed and sold generates one EPR certificate.
3. Tyre producers or importers buy these certificates to offset their legal obligations.
4. Payments happen directly through the online portal — fully traceable and legitimate.

Many mid-scale recyclers earn an additional 10–15 % profit margin annually from EPR certificate sales.

To keep your EPR income flowing:

• Upload monthly processing data on time.
• Maintain lab test reports for rCB, TPO, and steel output.
• Keep emission and water-quality records ready for audits.

Step 6: Managing Environmental Compliance

Environmental compliance isn’t a checkbox — it’s your insurance against closure.

Must-have systems:

• Continuous Emission Monitoring System (CEMS) linked to the SPCB server.
• Stack Emission & Ambient Air Quality Reports every quarter.
• Effluent Treatment Plant (ETP) for washing and cooling water.
• APCM maintenance logs — daily and monthly.
• Hazardous Waste Storage & Disposal Records with manifest copies.

Treat your compliance files like gold. When inspectors arrive, these documents decide whether you get praised or penalized.

Step 7: Understanding Risks & Penalties

Even one missing document can cost you months of downtime.

Common violations that attract action:

• Operating without renewed CTE/CTO.
• Using batch-type pyrolysis reactors.
• Not maintaining continuous emission data.
• Selling residues without authorized disposal partners.

Recent examples (2025):

• Punjab PPCB closed 11 out of 17 units found non-compliant.
• Telangana PCB sealed 3 units for missing online monitoring systems.

Penalties can include:

• Environmental compensation up to ₹50 lakhs.
• Immediate shutdown orders.
• Prosecution under the Environment Protection Act, 1986.

Step 8: Challenges on the Ground — and How Founders Overcome Them

Every entrepreneur faces a learning curve. Here are real-world challenges from Green Permits clients and how they solved them:

• Land selection delays: Arjun spent weeks chasing land conversion files before moving to an industrial estate — approvals came in half the time.
• Raw-material supply: A Surat unit signed MOUs with tyre dealers and transporters, ensuring 60 % of daily feedstock at stable rates.
• Product marketing: A Tamil Nadu recycler tied up with cement kilns for TPO fuel and auto-part manufacturers for rCB.
• License tracking: Founders use simple digital dashboards to get renewal reminders — avoiding last-minute panic.

Remember, success in this industry isn’t about the biggest plant — it’s about the most compliant one.

Step 9: Funding & Government Support

Setting up a recycling plant qualifies for multiple sustainability incentives.

Possible funding routes:

• MSME & Startup India registration → easy access to collateral-free loans.
• SIDBI’s Green Financing schemes for pollution-control and waste-management projects.
• State Pollution Control Boards in Gujarat, Maharashtra, and Tamil Nadu often provide concessional land or power tariffs for waste-recycling industries.

A solid compliance plan with CPCB authorization dramatically improves your credibility with banks and investors.

Step 10: The Road Ahead — India’s Circular Economy Revolution

India’s tyre recycling space is maturing fast. The CPCB’s stricter portal monitoring has already cleaned up most grey-area operators. By 2030, the sector will likely resemble the e-waste ecosystem — structured, audited, and digitally tracked.

If you join now, you’re not just starting a business — you’re building a future-ready recycling brand that can partner with large tyre manufacturers for long-term EPR contracts.

Conclusion — Turning Compliance into Competitive Advantage

The journey from idea to a functioning tyre recycling plant in India isn’t easy — but it’s absolutely achievable. Entrepreneurs like Arjun prove that compliance is not a hurdle; it’s the strongest foundation for growth.

With the right approvals, modern machinery, and strong environmental management, your plant can break even within two years — all while contributing to a cleaner, greener India.

If you’re ready to begin, start with your SPCB consent and CPCB EPR registration. Those two steps unlock everything else — funding, partnerships, and credibility.

📞 +91 78350 06182 | 📧 wecare@greenpermits.in
Book a Consultation with Green Permits — get expert help for licensing, setup, and EPR registration today.