NEW DELHI — India's Ministry of Mines is expected to shortly unveil a policy offering incentives for the domestic processing of lithium and nickel, with an estimated outlay of around 30 billion rupees ($313 million), according to two sources familiar with the matter.
The move aims to strengthen India's electric vehicle supply chain and reduce reliance on imports for critical minerals used in battery production, officials have indicated in earlier briefings.
Details of the final scheme remain under finalization, but the incentive plan proposes a 15% capital subsidy for eligible investments in lithium and nickel-processing projects starting on or after April 1, 2026, according to a government presentation reviewed by Reuters earlier this year.
Incentives would be available for five years and subject to caps, including limits based on a percentage of annual net sales turnover — up to 40% for lithium processing plants and 25% for nickel plants, the presentation showed. Lithium processing facilities would need a minimum capacity of 30,000 metric tons per year, while nickel plants would require at least 50,000 tons.
"India is in the advanced stages of framing a policy for processing critical minerals," Mines Secretary said in April, according to Reuters reporting at the time.
The initiative builds on India's broader push to develop a domestic battery ecosystem amid growing demand for electric vehicles. The country currently has limited refining capacity for these minerals and imports most of its requirements, primarily from countries including China and Australia.
Government efforts have included auctions of lithium blocks and other critical mineral exploration projects in recent years. The new processing incentives are seen as a complement to existing production-linked incentive schemes for advanced chemistry cells and electric vehicle manufacturing.
The Ministry of Mines did not immediately respond to requests for comment on the latest status of the scheme.
Officials have previously noted that the program could initially target a small number of projects to help meet domestic demand targets by 2030. Disbursement of subsidies is expected to occur in stages, linked to minimum utilization and performance criteria, sources said.
The announcement comes as global competition for critical minerals intensifies, with many nations seeking to secure supplies for the energy transition. India has identified lithium, nickel and other battery materials as strategic priorities.
Further specifics on eligibility criteria, application processes and exact timelines for the scheme's rollout are expected once the policy is formally notified.
