Cabinet Critical Mineral Capex Support Scheme

The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the Capex Support Scheme to Promote Critical Mineral Processing, allocating a budgetary outlay of ₹2,814 crore ($296.05 million) across a five-year implementation window from FY27 to FY31. Designed to build domestic processing infrastructure for critical minerals—specifically lithium and nickel—the initiative aims to curtail import vulnerability and fortify resilient domestic supply chains. The framework offers capital subsidies covering 30% of eligible capex to establish four greenfield processing plants: two lithium facilities with a minimum annual capacity of 30,000 tonnes each, and two nickel facilities with a minimum capacity of 50,000 tonnes each, which will also recover cobalt as a high-value operational by-product. Under the financial structure of the scheme, maximum capital assistance is capped at ₹500 crore ($52.60 million) per lithium processing beneficiary and ₹900 crore ($94.69 million) per nickel processing beneficiary. Selection will follow a competitive two-stage mechanism comprising technical qualification and financial bidding, awarding two entities per mineral under a least-cost criterion. Disbursement will occur across three performance-linked tranches tied to project execution milestones. Aligned with the Aatmanirbhar Bharat vision, the policy will catalyze domestic value addition and secure critical material inputs for high-growth strategic industries, including electric mobility, battery energy storage systems (BESS), defense, consumer electronics, and specialty steel manufacturing. NMDC