CAPEX Support Scheme to Promote Critical Mineral Processing

Key Highlights:

• The CAPEX Support Scheme to Promote Critical Mineral Processing has been approved with an outlay of ₹2,814 crore.
• The scheme will run for five years, from FY 2026-27 to FY 2030-31.
• It offers a 30% capital subsidy to establish two Lithium and two Nickel processing plants in India.
• The initiative is expected to anchor approximately ₹10,000 crore of investment.
• Its primary goal is to reduce import dependence and strengthen supply chain resilience for critical minerals.

Detailed Insights:

• Critical minerals are vital for economic development, national security, and the global transition to a low-carbon economy.
• India has identified 24 critical minerals, but largely imports refined intermediates and high-purity materials.
• The scheme aims to build domestic processing capacity for battery-grade Lithium products and Class-1/battery-grade Nickel sulphate.
• It targets creating 60 kt of Lithium and 100 kt of Nickel processing capacity by 2030.
• Beneficiaries will be selected through a competitive two-stage process involving technical qualification and financial bidding.
• Incentives will be disbursed in three tranches, linked to specific investment and equity milestones.
• A three-tier governance structure, including a Governing Council chaired by the Secretary, Ministry of Mines, will oversee the scheme.
• This scheme complements the National Critical Mineral Mission (NCMM), launched in January 2025, and ongoing mineral block auctions.
• It supports the vision of Atmanirbhar Bharat by fostering self-reliance in critical mineral processing.

Key Concepts Involved:

• Critical Minerals: Minerals essential for economic development, national security, and clean energy technologies due to their unique properties.
• Capital Expenditure (CAPEX) Support: Financial assistance provided by the government to encourage investment in long-term physical assets like processing plants.
• Supply Chain Resilience: The ability of a supply chain to resist, absorb, and recover from disruptions, ensuring continuous availability of goods.