Govt To Launch Incentive Scheme For Critical Minerals

SUMMARY

Sources said that the sops could take the form of “subsidies on capital expenditure” or production-linked-incentives (PLI)

The scheme will likely span a period of four to five years and would look to scale up India's capacity to recycle lithium-ion batteries

In January, the Union Cabinet approved the National Critical Mineral Mission (NCMM) with a total outlay of INR 16,300 Cr to secure a long-term sustainable supply of critical minerals

The union government reportedly plans to launch an incentive scheme later this year for the recycling of 24 critical minerals including lithium and cobalt.

Sources told Reuters that the sops could take the form of “subsidies on capital expenditure” or production-linked-incentives (PLI). As per the report, the scheme will likely span a period of four to five years and would look to scale up India’s capacity to recycle lithium-ion batteries.

It is pertinent to note that the Union Cabinet, in January this year, approved the National Critical Mineral Mission (NCMM) with a total outlay of INR 16,300 Cr. Under this, the government has identified 24 minerals as “critical” for meeting the country’s net zero greenhouse gas emissions targets by 2070.

The Mission also includes a provision of INR 1,500 Cr for providing incentives for setting up recycling facilities.

Meanwhile, secretary in the ministry of mines, VL Kantha Rao yesterday pitched for an exploration licence regime to unlock India’s critical mineral reserves.

Speaking at an event in New Delhi, Rao said that such a policy shift would move the focus from passive ownership to active exploration, adding that the regime will “empower” private entities to undertake large-scale early-stage exploration for minerals like Lithium, platinum group elements (PGEs), among others.

Additional secretary in the ministry, Sanjay Lohiya, also asserted that the government was dedicated towards enabling a competitive, technology-driven, and investment-friendly exploration ecosystem.

The comments come in the backdrop of the Centre pulling all stops to secure critical minerals necessary for green energy transition. These metals are the building blocks of our modern technology, and are used in mobile phones, semiconductors, solar panels, and electric vehicle (EV) batteries.

As part of this, the Mines and Minerals (Development and Regulation) Amendment Act, 2023 allowed private companies to participate in reconnaissance and prospecting for 29 critical and deep-seated minerals.

Finance Minister Nirmala Sitharaman, in her Budget 2025-26 speech, also proposed to scrap basic custom duty on waste and scrap of lithium-ion batteries, lead, zinc and other critical minerals.