Exp) Option a is the correct answer.

The circular economy is a model of production and consumption that emphasizes sharing, leasing, reusing, repairing, refurbishing, and recycling existing materials and products for as long as possible. This approach helps create a closed-loop system that minimizes waste and reduces the need for new resource extraction.

Statement I is correct: According to the Intergovernmental Panel on Climate Change (IPCC) Sixth Assessment Report (2023), human activities such as burning fossil fuels, deforestation, and intensive agriculture have contributed significantly to global warming, leading to an estimated 1.1°C increase in average temperature since the early 20th century. A circular economy mitigates these impacts by reducing waste, lowering resource consumption, and decreasing greenhouse gas emissions through sustainable practices.

Statement II is correct: With the global population increasing, so does the demand for raw materials. However, many essential natural resources are finite. The circular economy reduces dependence on virgin materials by promoting the reuse and recycling of products, conserving resources, and protecting ecosystems, thereby supporting biodiversity.
Statement III is correct: The circular economy also targets waste reduction during production by promoting efficient design and resource reuse. For example, agricultural waste like animal manure is repurposed into organic fertilizer and biogas, which supports sustainable farming and energy use.

As circular economy helps to mitigate greenhouse gas emissions through low raw material consumption and low waste production, option a is the correct answer: Both Statement II and Statement III are correct and both of them explain Statement I

Source: https://www.europarl.europa.eu/topics/en/article/20151201STO05603/circular-economy-definition-importance-and-benefits https://www.europarl.europa.eu/topics/en/article/20180301STO98928/greenhouse-gas-emissions-by-country-and-sector-infographic