Government may formalise incentives for critical minerals recycling this year

India is set to introduce incentive schemes this year to support recycling 24 identified critical minerals, including lithium and cobalt, which are essential for the green energy transition. These minerals have been categorised as strategic to India's roadmap for achieving net zero greenhouse gas emissions by 2070. The government has allocated Rs.1,500 crore (US$ 174.07 million) for recycling initiatives, forming part of a broader Rs.16,300 crore (US$ 1.89 billion) commitment towards developing the critical minerals sector. According to sources familiar with the matter, the proposed incentives may include capital expenditure subsidies or production-linked incentives, with the funds expected to be disbursed over the next four to five years. The initiative aims to scale India's lithium-ion battery recycling capacity to 75,000 metric tonnes annually. In a related move to improve material availability, the government eliminated customs duties in February 2025 on scrap and waste of key minerals such as lead, zinc, cobalt powder, and lithium-ion batteries. These minerals are vital to Electric Vehicle (EV) production, a sector India actively promotes to reduce dependence on fossil fuels. EVs comprised 2.5% of the 4.3 million cars sold in 2024, registering a 20% growth versus the broader market’s 5%. Analysts anticipate EV sales to double to around 2,00,000 units in 2025, fuelled by upcoming model launches.