Lithium, Nickel Processing: Cabinet Backs Rs 2,814 Crore Scheme
Two lithium and two nickel refineries will get up to 30% of their capital cost, chosen by the lowest subsidy each bidder asks for.
The Union Cabinet on 4 November approved a Rs 2,814 crore scheme that pays 30% of the capital cost of plants refining lithium and nickel in India, for the five years from 2026-27 to 2030-31, according to the official release. The government wants four plants, two for each metal, so that battery, electronics and defence makers buy less refined material from abroad. Early reports spoke of 24 critical minerals; the Cabinet release itself names only lithium and nickel, with cobalt recovered as a by-product of nickel.
Rs 500 Crore Cap for Lithium, Rs 900 Crore for Nickel
Each lithium beneficiary can receive at most Rs 500 crore and each nickel beneficiary at most Rs 900 crore. The plants must be large: at least 30 kt a year for each lithium plant and 50 kt for each nickel plant. Two beneficiaries will be chosen per mineral.
Selection has two stages, technical qualification and then a financial bid, and the company asking for the lowest subsidy wins. The money is paid in three tranches tied to milestones.
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Refining Is the Weak Link
The release says processing of critical minerals is concentrated in a few places, which creates supply-chain risk, and that India depends heavily on imports for refined intermediates. Domestic capacity is held back by high capital needs, limited access to technology and constraints on raw material. The refined metals are meant for electric vehicles, battery storage, electronics, defence and specialty steel.
The same Cabinet meeting approved Rs 14,500 crore for 92 GWh of grid energy storage, a market that will need large quantities of battery-grade lithium. Commerce Minister Piyush Goyal has also spoken about building machines at home if China curbs supply. More decisions are collected under Union Cabinet.
Bids Come Before Any Plant
The release gives no date for inviting bids, names no company and does not say where the plants will be built. It also does not state the investment the scheme is expected to bring in or the jobs it may create.
Source: Cabinet release on the capex support scheme for critical mineral processing. Also based on reporting by BW Businessworld and The Tribune.
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