Indian urban local bodies generate approximately 62 million tonnes of municipal solid waste annually, with collection coverage near 75 percent and scientific processing below 30 percent (CPCB, 2023). The Solid Waste Management Rules 2016 and the Extended Producer Responsibility regime for plastic packaging impose binding obligations on ULBs and registered producers, while capability and infrastructure gaps constrain implementation. AI applications in route optimization, vision-based sorting at material recovery facilities, IoT-enabled containerization, and dealer-network digital platforms offer compliance pathways whose value is conditional on organizational capability, stakeholder legitimacy, and secondary-market depth. This study develops scenario-based forecasts to 2050 by operationalizing four theoretical frames, the circular economy framework, diffusion of innovation, the resource-based view, and stakeholder theory, into a hybrid simulation model with parameters calibrated through systematic review of 147 studies, of which 28 represent Indian or South-Asian contexts. Analysis of 100 simulated municipalities across four scenarios generates conditional projections of recycling rates, material recovery, and circularity outcomes against SWM Rules 2016 benchmarks and SDG 11.6 indicators. Under Capability-First assumptions, model outputs indicate 68 percent conditional probability of meeting the 2035 processing benchmark against 34 percent under Baseline assumptions. Technology-Led scenarios achieve 60 percent adoption by 2035 with 52 percent recycling rate, reflecting the model's capability-moderation specification. Sensitivity analysis identifies 2026 to 2029 as a decision window where capability investment timing alters simulated trajectories. Findings offer conditional roadmaps for ULB administrators, state governments, producer-responsibility organizations, and technology vendors operating in the Indian MSWM ecosystem, subject to empirical validation.