Cabinet Approves ₹2,814 Crore Critical Mineral Processing Scheme
The Union Cabinet chaired by Prime Minister Narendra Modi has approved the 'Capex Support Scheme to Promote Critical Mineral Processing' with a financial outlay of ₹2,814 crore over a five-year period from FY 2026-27 to 2030-31. The scheme addresses India's substantial import dependence for refined intermediates and high-purity materials of critical minerals including Lithium, Nickel, and Cobalt, which exposes supply chains to geopolitical disruptions, price volatility, and potential supply restrictions.
The scheme provides targeted capital expenditure support for establishing and operationalizing domestic processing facilities, with the objective of developing resilient end-to-end value chains, maximizing value addition, achieving import substitution, and supporting critical sectors such as electric mobility, Battery Energy Storage System (BESS), electronics, defence, and speciality steel.
Under the scheme, capital subsidy of 30% of eligible investment will be provided for setting up four critical mineral processing plants: two lithium processing plants with minimum capacity of 30 kt each and two nickel processing plants with minimum capacity of 50 kt each. Cobalt is expected to be recovered as a by-product of nickel production. The maximum capital support is capped at ₹500 crore per lithium beneficiary and ₹900 crore per nickel beneficiary.
Beneficiary selection will follow a two-stage process involving technical qualification assessment followed by financial bidding based on the least-cost criterion (lowest CAPEX support sought). Incentives will be disbursed in three tranches linked to achievement of specified milestones. This initiative supports the objectives of Atmanirbhar Bharat by strengthening India's capabilities across the critical mineral value chain and reducing vulnerability to global supply chain disruptions.