India Unveils Rs 1,500 Crore Incentive Scheme to Turbocharge Critical Mineral Recycling

In a major push towards mineral self-reliance and the circular economy, the Ministry of Mines on Saturday unveiled the detailed operational guidelines for the Critical Mineral Recycling Incentive Scheme. With a total outlay of nearly crore, the scheme is designed to rapidly scale up India’s capacity for extracting crucial minerals from waste streams such as e-waste, spent lithium-ion batteries, permanent magnets, and alloy scraps.

The scheme, formally notified on September 8, 2025, is a key component of the National Critical Minerals Mission and seeks to secure the supply of minerals essential for clean energy, electric mobility, electronics, and advanced manufacturing—sectors vital to India's future economy. These include lithium, cobalt, nickel, rare earth elements, and platinum group metals, which are currently concentrated in a few global regions.

The guidelines classify eligible beneficiaries—recyclers involved in the actual extraction of critical minerals—into two groups based on their global manufacturing revenue to ensure support reaches both established players and emerging start-ups.

• Group A: Includes large, established recyclers with revenues of at least  Rs. 200 crore. They are required to invest a minimum of Rs. 100 crore and establish facilities with a capacity of 10,000 tonnes per year.
• Group B: Covers smaller recyclers and start-ups with revenues below Rs 200 crore. These entities must commit to a minimum investment of Rs 25 crore and establish a capacity of 5,000 tonnes.

The total scheme outlay has been strategically segmented: Rs 700 crore is earmarked for lithium-ion battery recycling, Rs. 650 crore for e-waste, and Rs. 135 crore for other waste streams. Group A recyclers are eligible for up to Rs. 990 crore in incentives, with Rs. 495 crore reserved for Group B, offering flexibility for fund reallocation as needed.

The financial support is structured into two main forms:

1. Capital Expenditure (Capex) Subsidies: These range from 14% to 20% of the eligible capital expenditure, with the higher percentage allocated to projects that commence production sooner after obtaining environmental clearance.
2. Operational Expenditure (Opex) Support: This is performance-linked, tied to incremental sales over a base year. Recipients will receive 40% of the eligible operational incentive in the second year and the remaining 60% in the fifth year, subject to achieving pre-defined sales thresholds. For instance, Group A must achieve sales of Rs. 60 crore in year two and Rs. 150 crore in year five.

Incentives are capped at Rs. 50 crore per entity for Group A and Rs. 25 crore for Group B.

The application window for interested recyclers, including those setting up new facilities or expanding existing ones, is now open and will remain so for six months, until April 1, 2026.