PIB TrackerCabinet approves Rs 2,814 crore lithium, nickel processing support
A five-year capex support scheme will give a 30% capital subsidy for four plants, two lithium and two nickel, chosen through two-stage bidding, to cut import dependence in refined battery-grade materials.
What happened
- The Cabinet approved the Capex Support Scheme to Promote Critical Mineral Processing with an outlay of Rs 2,814 crore over five years, FY 2026-27 to 2030-31.
- The release says processing is geographically concentrated, exposing supply chains to disruption and price volatility, and that India relies on imports for refined intermediates and high-purity materials.
- The scheme targets lithium and nickel ores and intermediates, with cobalt recovered as a nickel by-product, for electric mobility, BESS, electronics, defence and speciality steel.
- It gives a 30% capital subsidy for four plants, two lithium (at least 30 kt each) and two nickel (at least 50 kt each), capped at Rs 500 crore per lithium and Rs 900 crore per nickel beneficiary.
- Beneficiaries are picked in two stages, technical then financial bidding, on the lowest capex support sought, and paid in three milestone-linked tranches.
For Prelims
- Critical minerals: India's 2023 list names 30 minerals including lithium, cobalt and nickel; NMC (nickel-manganese-cobalt) batteries are one reason nickel and cobalt matter for electric vehicles.
- National Critical Mineral Mission: approved in January 2025 with an outlay of about Rs 16,300 crore; it covers exploration, processing, recycling and overseas assets.
- Beneficiation and processing: beneficiation raises ore grade near the mine; processing or refining turns concentrate into high-purity compounds, the stage the scheme subsidises.
- Capex support versus PLI: a production-linked incentive pays on output; capex support pays a share of investment (30% here) in milestone tranches.
- Recycling incentive: PIB release 2256977 records a Rs 1,500 crore scheme, notified on 2 October 2025, with 58 companies found eligible.
- MMDR Amendment Act, 2023: put 24 critical minerals in Part D of the First Schedule, so the Centre auctions their mining leases; lithium is among them.
- Lithium in India: the Geological Survey of India reported an inferred lithium resource of about 5.9 million tonnes at Reasi, Jammu and Kashmir, in February 2023.
- Partnerships: KABIL (2019) acquires overseas mineral assets, and India joined the Minerals Security Partnership in June 2023.
For UPSC: Critical mineral Capex Support Scheme: Rs 2,814 crore, 2026-27 to 2030-31; 30% subsidy, 2 lithium (30 kt) + 2 nickel (50 kt) plants; caps Rs 500 crore, Rs 900 crore.
What it is NOT: The release does not say how many critical minerals beyond lithium and nickel will be covered later, or name any bidder or site. It does not give the expected cost of a plant, the processing technology to be used, or where the raw material will come from; it admits constrained access to raw materials. Capacity targets are minimums, with no output or import-saving figure. Nothing is said about environmental clearance, tailings, or what happens if a beneficiary misses a milestone or the plant under-performs.
For Mains
Syllabus: GS3.8 · GS3.1 · Linkage L1
Anchor
Electric vehicles, grid batteries and defence kit all run on materials that India mostly imports in refined form. Processing, not only mining, is where supply risk sits.
Substantiation (data)
The Cabinet approved Rs 2,814 crore for FY 2026-27 to 2030-31: a 30% capital subsidy for 2 lithium plants (30 kt each) and 2 nickel plants (50 kt each), capped at Rs 500 crore and Rs 900 crore.
Position
Subsidising the capital-heavy refining step with least-cost bidding keeps the price of support low and milestone tranches tie money to plants that actually get built.
Counterpoint
Four plants are a small base, the caps total Rs 2,800 crore, and the release itself notes limited technology and constrained access to raw materials. Money cannot buy ore India does not have.
Way forward
Secure feedstock through KABIL and overseas deals, pair this scheme with recycling and exploration under the Mission, and publish plant-level timelines and import-substitution targets.
Conclusion
The scheme moves India one step up the battery value chain. Its test is plants running on assured ore.
Deploys into: Critical minerals and supply-chain resilience · Industrial policy and import substitution · Energy transition and EV supply chains · Atmanirbhar Bharat
Cabinet · 2026-11-04 · PRID 2332476 · PIB source ↗