In a major step toward strengthening India’s resource self-reliance, the Ministry of Mines has launched a ₹1,500 crore Incentive Scheme for the Promotion of Critical Minerals Recycling. The scheme, notified under the National Critical Mineral Mission (NCMM), aims to support industrial units engaged in recycling critical minerals from secondary sources such as e-waste and used lithium-ion batteries.
The initiative comes at a time when India faces a high import dependency—over 80%—on 24 critical and strategic minerals, most of which are essential for clean energy, aerospace, defence, electronics, and fertilizers. These minerals are vital to India’s energy transition goals and technological sovereignty.
“Critical minerals are not just materials—they’re the foundation of national security and clean energy. This scheme will create reverse supply chains to recover what we already imported and unlock domestic value,” said an official from the Ministry of Mines.
🛠️ What Are Critical Minerals and Why They Matter?
Critical minerals such as lithium, cobalt, nickel, graphite, and rare earth elements are essential components in products like:
- Lithium-ion batteries (used in EVs and mobile devices)
- Solar panels and wind turbines
- Electronics and defence systems
- Space and aeronautical applications
Currently, over ₹80,000 crore worth of these minerals are imported annually, with most global refining capacities located in China. This heavy reliance presents a strategic risk, especially in an era of global supply chain disruptions.
♻️ The Urban Mining Opportunity
India generates millions of tons of e-waste and battery waste each year, which contains recoverable amounts of critical minerals. However, most existing recycling units focus only on dismantling and sorting—not actual chemical extraction of these materials.
According to government data:
- 322 registered e-waste recyclers have ~2.2 million tonnes/year of processing capacity.
- Only 10–12 recyclers engage in actual extraction of critical minerals (R3 and R4 level).
- India’s LIB (Lithium-ion battery) recycling capacity is ~100 kilo tonnes per annum—needs to quadruple by 2030 to meet projected demand.
🎯 Key Objectives of the Scheme
- Reduce import dependence and enhance domestic mineral security.
- Support industrial recycling capacity expansion and modernization.
- Create sustainable supply chains using secondary (scrap) sources.
- Encourage private investment in reverse logistics and recovery technologies.
💸 Incentive Structure at a Glance
The scheme will provide Capital Expenditure (Capex) and Operational Expenditure (Opex) subsidies to eligible recycling units.
✅ Capex Subsidy:
- 20% subsidy on capital expenditure for new units/expansion.
- Tapered to 17% or 14% depending on time taken to start production.
- Refurbished machinery allowed up to 20% of total capital cost.
✅ Opex Subsidy:
- Based on incremental sales over FY 2025–26 (base year):
- 40% in Year 2
- 60% in Year 5
- Applicable only if specific revenue thresholds are met:
- ₹60 crore (Group A) / ₹30 crore (Group B) in Year 2
- ₹150 crore (Group A) / ₹75 crore (Group B) in Year 5
✅ Beneficiary Ceiling:
- Group A (GMR ≥ ₹200 crore): Max ₹50 crore
- Group B (GMR < ₹200 crore): Max ₹25 crore
- Opex subsidy capped at ₹10 crore (Group A) and ₹5 crore (Group B)
🧾 Who Can Apply?
Eligible applicants include recyclers registered in India, with proper authorization under environmental rules such as:
- E-Waste Management Rules, 2022
- Battery Waste Management Rules, 2022
- End-of-Life Vehicles Rules, 2025 (for catalytic converters and auto waste)
The scheme supports:
- New units
- Expansion of existing facilities
- Modernization and diversification
Applicants must recycle at L3 or R3/R4 levels, i.e., chemical processing and extraction—not just collection or mechanical shredding.
⚗️ What Kind of Recycling Is Covered?
The scheme supports recovery of critical minerals with ≥99% purity and at least 80% yield efficiency, from:
- E-waste: mobile phones, computers, consumer electronics
- LIB scrap: dead lithium-ion batteries from EVs and electronics
- Other sources: end-of-life vehicle parts, industrial scrap, etc.
🧪 Eligible Processes Include:
- Hydrometallurgy
- Advanced chemical extraction
- End-to-end battery recycling (R4)
🗂️ Timeline and Governance
- Scheme Duration: FY 2025–26 to FY 2030–31 (6 years)
- Initial Application Window: 6 months from call for proposals
- Implemented via a Project Management Agency (PMA)
- Oversight by:
- Executive Committee (EC) chaired by Joint Secretary, Ministry of Mines
- Governing Council (GC) chaired by the Secretary, Ministry of Mines
Mid-term assessments will track performance and allow course correction.
📌 List of Critical Minerals Covered (Excerpt from Appendix-I)
- Lithium
- Cobalt
- Nickel
- Graphite
- Rare Earth Elements
- Tungsten, Vanadium, Molybdenum
- Gallium, Indium, Germanium
- Zirconium, Beryllium, Niobium, and others
➡️ Total: 27 critical and strategic minerals
(See full list in scheme document attached below)
📈 What This Means for India
The scheme marks a strategic shift from dependency on imported raw materials to building a circular economy around critical minerals. By incentivizing urban mining and domestic recovery, India can:
- Strengthen its clean energy and electronics manufacturing sectors.
- Boost EV battery localization.
- Reduce trade deficits.
- Create high-tech green jobs in recycling and metallurgy.
🔚 Conclusion
The Ministry of Mines’ ₹1,500 crore initiative underlines India’s commitment to resource resilience, industrial innovation, and environmental sustainability. As the country prepares to scale up electric mobility, clean energy, and digital infrastructure, the recycling of critical minerals will play a pivotal role in ensuring India’s strategic autonomy.