Call for Proposals: SME-led Plastic Recycling for a Circular Economy in Pakistan

Aims

• The initiative aims to strengthen local and national circular economy framework and practices by supporting plastic waste recovery and recycling through SME business models.

Objectives

• The project seeks to transform plastic waste into an economic opportunity by empowering small and medium-sized enterprises (SMEs) engaged in plastic recycling to adopt sustainable and circular practices. It aligns with UNEP’s Medium-Term Strategy 2022–2025 and SDG 12 on sustainable consumption and production, as well as Pakistan’s commitment under its national plastic action agenda and circular economy roadmap.
• The current call for proposals aims to identify and support local not-for-profit implementing partners who can facilitate pilot interventions that enhance the capacity and performance of plastic recycling SMEs. These pilots are intended to promote inclusive and climate-responsive plastic waste management solutions by:
  • Demonstrating scalable and locally adaptable recycling systems;
  • Fostering collaboration among municipal authorities, private recyclers, and communities;
  • Encouraging technological innovation and business model improvements; and
  • Enabling supportive policy environments that formalize and integrate informal actors.

Project Description

• The project “From Waste to Wealth: SME-led Plastic Recycling for a Circular Economy in Pakistan – Pilot Implementation at Local Levels” seeks to operationalize a city-level plastic recycling model that is led by small and medium enterprises (SMEs) and tailored to the local context. Building on the feasibility study completed in FY2024, which mapped the plastic recycling landscape and assessed SME capacities, the current phase aims to implement and test a practical and scalable model in a municipality proposed by the selected implementing partner. The proposal must justify the chosen location based on local needs, institutional readiness, and engagement with relevant stakeholders.
• The implementation will be structured around four sequential and interconnected components. The first component involves conducting a detailed baseline assessment in the selected city or municipality. This includes analyzing existing plastic waste streams, identifying the current SME landscape and their operational bottlenecks, and mapping key stakeholders including municipal authorities, informal sector workers, and community groups. The partner is expected to establish a local coordination mechanism to facilitate smooth engagement with these actors. The output of this stage will be a baseline report that reflects the local context, data-driven priorities, and a stakeholder coordination strategy.
• The second component focuses on customizing the SME-led business model and preparing the technical and financial groundwork for pilot operations. Using insights from the baseline assessment, the partner will identify two to three SMEs that are suitable for piloting. The selected SMEs should be formally registered, active in the recycling sector, and demonstrate readiness to participate in the pilot. The implementing partner will develop detailed business and technical plans tailored to each SME’s needs, covering operational workflows, infrastructure requirements, product-market alignment, and financial viability. This planning stage will also include a risk assessment and mitigation strategy.
• The third component transitions from planning to action, whereby the selected SMEs will be supported through a coordinated pilot rollout. The implementing partner will provide hands-on technical assistance, training on material handling and sorting, and support in accessing basic resources necessary to operationalize recycling activities. Regular monitoring will be conducted to track the performance of SMEs and ensure alignment with the proposed business models. The implementing partner is expected to document implementation processes, collect performance data, and submit an interim report detailing the progress, challenges encountered, and preliminary outcomes.
• The final component of the project centers on evaluating the pilot’s overall impact and planning for replication. The implementing partner will conduct a comprehensive evaluation to measure the pilot’s effectiveness across technical, financial, environmental, and social dimensions. This evaluation will feed into the development of a final report that captures lessons learned, success factors, and potential improvements. In addition, the partner will be responsible for producing a knowledge product — such as a policy brief, case study, or implementation guide — that can be disseminated to local and national stakeholders, as well as international development partners. A final presentation summarizing results and recommendations will also be expected to support donor reporting and future scaling discussions.
• Throughout the project, the partner will be required to submit output-based financial and narrative reports according to UNEP’s Small-Scale Funding Agreement (SSFA) requirements. The partner must also adhere to UNEP’s communication and visibility standards and participate in regular review meetings with UNEP-IETC and its collaborating organizations, including the IGES-CCET team. All deliverables must be completed within the implementation period, ensuring a strong emphasis on efficiency, transparency, and impact.

Eligibility Criteria

• To be eligible for consideration, the applicant must be a legally registered not-for-profit organization with a demonstrable track record of implementing projects in areas related to plastic waste management, small and medium enterprise (SME) development, circular economy, or sustainable livelihoods in urban settings. The organization should have at least three years of verifiable operational experience in Pakistan or similar developing country contexts and be able to show technical competence in community-based project implementation, environmental sustainability, and/or value chain development.
• Applicants must demonstrate their ability to coordinate effectively with municipal authorities, relevant national agencies, private sector actors, and informal sector stakeholders. Prior experience in working with SMEs, cooperatives, or informal workers involved in the recycling or waste sector will be viewed as a significant asset. The ability to navigate multi-stakeholder environments and secure buy-in from local actors will be critical for successful project execution.
• The organization should possess sound financial and administrative management systems that comply with international standards and UNEP’s due diligence requirements. This includes having transparent accounting procedures, adequate internal controls, and the ability to manage and report on grant-based funding in a timely and accurate manner.
• As part of the application package, interested entities must submit a comprehensive technical proposal. The proposal should clearly articulate the rationale for selecting the proposed pilot location, describe the local context, and present a feasible implementation strategy that aligns with the four core activities of the project. In addition, the proposal must include a detailed workplan, a timeline of activities, a stakeholder engagement approach, risk mitigation measures, and a realistic budget aligned with output-based financing. Evidence of institutional capacity, prior project results, and staffing plans should also be included.

For more information, visit UNEP.