New Delhi, November 4, 2026: The Indian government is reportedly preparing a ₹2,800 crore capital expenditure support scheme to strengthen domestic processing of critical minerals such as lithium and nickel. The proposal is expected to be considered by the Union Cabinet on Wednesday as India seeks to reduce its dependence on imported processed minerals and strengthen supply chains for electric vehicles and battery manufacturing.
Government Proposes ₹2,800 Crore Investment Scheme
According to reports, the proposed scheme will provide financial assistance to companies setting up facilities for processing lithium and nickel ores into high-purity compounds.
The initiative aims to expand India’s domestic mineral-processing capacity and support industries that depend on these strategically important materials.
30% Capital Subsidy for Processing Plants
The scheme is expected to offer a 30% subsidy on eligible capital investment for establishing four mineral-processing facilities.
These would include two lithium-processing plants with a minimum capacity of 30,000 tonnes each and two nickel-processing plants with a minimum capacity of 50,000 tonnes each.
The maximum financial assistance could be capped at ₹500 crore for each lithium project and ₹900 crore for each nickel project.
Critical Minerals Essential for Electric Vehicles
Lithium, nickel and cobalt are key components of lithium-ion batteries used in electric vehicles, smartphones, electronics and energy-storage systems.
Under the proposed programme, cobalt could also be recovered as a by-product of nickel processing.
The scheme is expected to support sectors including electric mobility, battery energy storage, defence and speciality steel manufacturing.
Four States Identified for Mineral Processing Parks
The government has identified Gujarat, Andhra Pradesh, Odisha and Maharashtra for developing dedicated critical mineral-processing parks.
Gujarat and Andhra Pradesh are expected to focus on rare earth processing, while Odisha could specialise in nickel and Maharashtra in lithium.
The proposed parks are intended to create integrated ecosystems supporting mineral processing and related industries.
India Seeks to Reduce Dependence on China
India currently has limited processing capacity for several critical minerals and relies heavily on overseas suppliers.
China dominates global critical mineral processing, creating concerns about supply disruptions and the availability of materials essential to emerging technologies.
Developing domestic processing facilities could help India diversify supply chains and strengthen strategic industries.
Part of National Critical Minerals Mission
The proposed initiative aligns with India’s broader National Critical Minerals Mission, which focuses on improving access to strategically important minerals.
The government is also working on a national stockpiling programme to maintain reserves of essential minerals during international supply disruptions.
Cabinet Approval Still Awaited
The ₹2,800 crore proposal has not yet been confirmed as approved, and the government has not announced final implementation guidelines.
If cleared, the scheme could encourage investment in domestic mineral-processing facilities and support India’s growing electric vehicle, electronics and clean-energy industries.
Source: The Indian Express, Ministry of Mines
Supreme News Network
