India is entering a new era, where the focus is on securing resources and promoting green growth. Focusing on this, the Ministry of Mines has launched an Incentive Scheme for Promotion of Critical Minerals Recycling. This Incentive Scheme is the main part of the National Critical Mineral Mission (NCMM). The focus of the mission was to reduce the dependence on minerals India imports from outside and to increase India's own capacity to recycle minerals.

Important minerals such as lithium, cobalt, nickel, etc, are essential for batteries, electronics, space technology, defence equipment, fertilisers and clean energy systems. India imports over 80% of its key minerals, posing a major supply chain risk. The project is designed to promote urban mining, encourage domestic recyclers, and create a sustainable supply chain for the future.

The budget of the scheme is Rs. 1,500 crore, which will lay a strong foundation for recycling industries, create jobs, save foreign exchange and promote the vision of an Aatmanirbhar Bharat in the minerals sector.

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What is the Incentive Scheme for Promotion of Critical Minerals Recycling?

The Critical Minerals Recycling Incentive Scheme is a government initiative under the National Critical Mineral Mission. Its focus is to provide monetary support to recyclers who extract and recover critical minerals from secondary sources such as e-waste, lithium-ion battery scrap, and end-of-life vehicles.

Instead of purely depending on mining, the scheme promotes urban mining, extracting minerals already present in waste streams within India. Recycling not only reduces import dependence but also prevents environmental pollution caused by discarded batteries and electronics.

This scheme does not just depend on mining, but it promotes urban mining and extracts minerals, which are present in waste streams in India. Recycling not only reduces import reliance but also decreases pollution produced by waste batteries and electronics. The scheme supports:

• Capex subsidies for setting up or expanding recycling plants.
• Opex subsidies linked to incremental sales.
• A hybrid model that combines both forms of incentives.

Objective of the Scheme

The main objectives of the scheme are:

• This reduces import reliance. India spends more than Rs. 80,000 crore annually on critical mineral imports, so this will reduce it.
• This will focus on strong and developed recycling industries in India, such as lithium-ion batteries, electronic waste, end-of-life vehicles and grow them.
• It will make India such that it does not need to import critical minerals from outside and gets all the critical minerals here itself.
• This will promote clean energy, such as electric vehicles, renewable energy.
• Critical mineral recycling Incentive Scheme will ensure that the minerals already present under this structure are reused, so that waste, pollution and environmental damage are reduced.
• This Incentive Scheme will promote startups and MSME, every recycler and startup will promote new recycling technologies while keeping in mind the government norms.

List of Critical Minerals under this Scheme

The scheme covers 27 critical minerals. These minerals are important for India’s economic and strategic sectors. The critical minerals covered under the Incentive Scheme are:

1. Antimony bearing ores
2. Beryl and other beryllium bearing minerals
3. Bismuth bearing ores
4. Cadmium bearing minerals
5. Cobalt bearing minerals
6. Gallium bearing minerals
7. Germanium bearing Zinc ores
8. Glauconite
9. Graphite
10. Indium bearing minerals
11. Lithium bearing minerals
12. Molybdenum bearing minerals
13. Nickel bearing minerals
14. Niobium bearing minerals
15. Phosphate (without uranium)
16. Platinum group of elements bearing minerals
17. Potash
18. Rare Earth Elements (minerals of the “rare earths” group not containing Uranium and Thorium) 
19. Rhenium bearing minerals
20. Selenium bearing minerals
21. Tantalum bearing minerals
22. Tellurium bearing minerals
23. Tin bearing minerals
24. Titanium bearing minerals and ores (ilmenite, rutile and leucoxene)
25. Tungsten bearing minerals
26. Vanadium bearing minerals
27. Zirconium-/ Hafnium-bearing minerals and ores, including Zircon

Also Read: Incentive Scheme to Promote Critical Mineral Recycling: Cabinet Approves ₹ 1,500 Crore Push

Eligibility of Investment

The eligibility criteria under the scheme are clearly defined:

1. Target Beneficiaries

This scheme is made for recyclers who take out useful minerals from waste products. To get the benefits, these recyclers must be registered in India and have valid registration certificates from CPCB or SPCB.

2. Classification by Revenue

Recyclers are divided into two groups based on Global Manufacturing Revenue (GMR):

• Group A: Revenue of Rs. 200 crore or more (large and established recyclers).
• Group B: Revenue below Rs. 200 crore (small units and startups).

3. Coverage of Investment

The scheme gives support to both new recycling units and the upgrading or expansion of old units.

4. Types of Recycling Systems

The scheme covers recycling of e-waste like old electronics, lithium-ion battery (LIB) scrap, and other waste or scrap materials.

5. Compliance for Existing Units

Recycling units already working must have valid registrations under rules like the E-Waste Rules 2022, Battery Waste Rules 2022, and End-of-Life Vehicles Rules 2025.

6. Requirements for New Units

New or startup recycling units must get registration under the EPR rules before they start recycling work.

7. Feedstock Sourcing

Recyclers can use waste from India or outside, but they must follow all the laws and rules for sourcing.

Incentive Structure

The scheme offers three types of financial incentives:

1. Capex Subsidy

This subsidy provides:

• 20% subsidy on eligible capital expenditure for setting up new plants or expanding existing ones.
• Eligible expenses include plant, machinery, equipment, and utilities.
• Refurbished equipment (up to 20% of cost) is also allowed.
• Subsidy depends on the time taken to start production. Like if it started on time means within 18-24 months, then it is 20% and if production got delayed, then it reduces to14-17%.

2. Opex Subsidy

Recyclers will be supported by funds based on their additional sales compared to the first year (2025-26). They will receive 40% in the second year and the remaining 60% in the fifth year (between 2026-27 and 2030-31). But this will happen only if they reach the required sales target.

3. Hybrid Model

Recyclers may opt for a mix of Capex and Opex subsidies.

Process Parameters of the Scheme

The scheme defines input, output, and process standards to ensure high-quality mineral recovery.

1. Eligible Inputs

The scheme permits only specific waste streams that contain critical minerals. These include e-waste such as discarded electronics defined under the E-Waste Rules 2022, lithium-ion battery scrap covering chemistries like LFP, NMC, and LCO, and catalytic converters from end-of-life vehicles.

2. Eligible Outputs

Recyclers must deliver recovered minerals in a usable or intermediate form with a minimum purity of 99%, ensuring quality and industrial usability.

3. Eligible Processes

Only advanced recycling methods such as hydrometallurgy are allowed. For batteries, R3 (black mass to metal salts) and R4 (end-to-end recycling) are eligible, while dismantling, shredding, or producing black mass alone do not qualify.

4. Yield Target

Units must achieve at least 80% recovery efficiency from recoverable materials.

Tenure of the Scheme

The Critical Minerals Recycling Incentive Scheme will run for 6 years, from FY 2025-26 to FY 2030-31. Recyclers will be given 6 months so that they can avail the benefits of this Incentive Scheme. All the applications received will be thoroughly checked one by one. Whatever work has to be done will be done only after these approvals. And if the need arises, the government can ask you to file a new application.

Threshold of the Investment

If one wants to avail the benefits of this scheme, applicants will have to invest a minimum amount, which is called the threshold investment. This rule is the same for all, be it new industries or existing ones that want to expand their business, adopt new methods and modernize it. And the government will keep reviewing and updating the list and the threshold amount every few days so that this scheme works with complete justice and full impact.

Approval and Disbursement Process of the Scheme

The approval process is designed to be transparent and efficient:

1. Application

Eligible recyclers in India can submit applications under the scheme. Each project will be considered as a separate and independent application. This will ensure fairness and effectiveness.

2. Appraisal

Once received, applications undergo initial inspection and acknowledgement by the Project Management Agency (PMA). This is followed by a detailed appraisal to check eligibility and compliance with scheme requirements.

3. Approval

Based on appraisal results, the Executive Committee (EC) provides recommendations. The PMA then issues the final approval, allowing genuine projects to move forward.

4. Disbursement

Financial incentives are released only after the unit begins commercial production. Recyclers must submit claims every six months, and the unit must remain operational for at least three years after receiving incentives. This ensures only active and credible projects benefit from the scheme.

Governance Mechanism of the Scheme

The scheme will be governed by a three-tier mechanism:

1. Project Management Agency (PMA)

• Receives applications.
• Conducts appraisal and disbursement.
• Submits periodic reports.

2. Executive Committee (EC)

• Chaired by a Joint Secretary of the Ministry of Mines.
• Includes representatives from relevant ministries.
• Reviews and recommends projects.

3. Governing Council (GC)

• Chaired by the Secretary, Ministry of Mines.
• Includes government and industry experts.
• Reviews progress, suggests amendments, and ensures impactful implementation.

Conclusion

The Incentive Scheme for Promotion of Critical Minerals Recycling, launched by the Ministry of Mines, is an initiative that will support India in achieving its goals. The scheme targets financial incentives and reduces dependency on critical minerals imported from outside, thereby improving India's recycling system. 

This scheme is a great opportunity not only for big companies but also for MSMEs and startups. It will ensure that they can properly participate in the industry. It not only provides industrial benefits but also protects the environment. 

This will grow recycling industries in India and take those initiatives. Its budget is Rs. 1500 crore for 6 years. And this will last from FY 2025-26 to FY 2030-31. And this will not only increase investment but it will also increase jobs and will directly help the Indian economy.