Cabinet approves ₹1,500 crore incentive scheme for critical mineral recycling
Six-year scheme targets battery waste, e-waste and end-of-life vehicle scrap — with capex and opex subsidies for recyclers.
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The Cabinet approved a ₹1,500 crore incentive scheme for critical mineral recycling (FY26–FY31) — targeting e-waste, lithium-ion battery scrap and end-of-life vehicle scrap — as part of the National Critical Mineral Mission.
The incentives
- Capex subsidy: 20% on plant, machinery and utilities
- Opex subsidy: on incremental sales over FY26 base — 40% in year 2, 60% in year 5
- Ceilings: ₹50 Cr per large entity, ₹25 Cr per small entity (one-third of outlay reserved for small/new recyclers incl. startups)
- Eligible: value chain extracting critical minerals — not black-mass-only producers
Expected outcomes
- 270 kilo-tonne annual recycling capacity
- ~40 kilo-tonne annual critical mineral production
- ~₹8,000 crore investment
- ~70,000 direct & indirect jobs
India imports over 90% of its lithium, cobalt and nickel. With LFP batteries entering the market and EV volumes growing, battery scrap is the fastest-scaling domestic source of critical minerals. This scheme is the demand-side push for the recycling industry (Lohum, BatX and peers).
The pattern
The scheme follows Budget 2025's customs duty exemption on lithium-ion battery scrap — a one-two punch: make scrap cheaper to import, then subsidise domestic extraction capacity.
Battery recycling is shifting from ESG story to subsidised industry — the capex subsidy changes the unit economics for recyclers.Advertisement
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