New Delhi: The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved a Rs 2,814-crore scheme to promote domestic processing of critical minerals, including lithium and nickel, as India seeks to reduce import dependence and strengthen supply-chain security.
The capital expenditure support scheme will run from 2026-27 to 2030-31 and provide a 30% subsidy on eligible investments for setting up four processing plants — two each for lithium and nickel.
Each lithium plant will have a minimum processing capacity of 30,000 tonnes, while nickel plants will have a minimum capacity of 50,000 tonnes. The maximum capital support has been capped at Rs 500 crore per lithium beneficiary and Rs 900 crore per nickel beneficiary.
Beneficiaries will be selected through a two-stage process involving technical evaluation and financial bidding. Two companies will be chosen for each mineral based on the lowest capital support sought. Incentives will be disbursed in three instalments linked to specified project milestones.
The scheme also envisages recovering cobalt as a by-product of nickel processing.
The government said India’s domestic critical mineral processing capacity remained limited, leaving the country dependent on imports of refined intermediates and high-purity materials. Concentration of processing facilities in a few countries also exposes global supply chains to geopolitical disruptions and price volatility.
The initiative is expected to support key sectors such as electric vehicles, battery energy storage systems, electronics, defence and speciality steel, while strengthening India’s domestic critical mineral value chain.
