Introduction: Critical Mineral Recycling Incentive Scheme
India is rapidly moving toward electric mobility, clean energy storage, and advanced manufacturing. As a result, the demand for lithium, cobalt, nickel, graphite, rare earth elements, and other critical minerals is increasing every year. However, India still depends heavily on imports for many of these minerals. Therefore, the Government of India has introduced the Critical Mineral Recycling Incentive Scheme to strengthen domestic recycling infrastructure and recover valuable minerals from waste streams.
The scheme offers substantial financial incentives for lithium-ion battery recycling plants, e-waste recycling facilities, and critical mineral recovery projects. It also supports investments in advanced recycling technologies such as hydrometallurgy, pyrometallurgy, and black mass recovery.
At Finraja Consultancy Private Limited, we help businesses understand the Critical Mineral Recycling Incentive Scheme, prepare project reports, structure subsidy claims, and manage documentation for faster approvals.
What is the Critical Mineral Recycling Incentive Scheme?
The Critical Mineral Recycling Incentive Scheme is a government initiative launched under the Ministry of Mines to promote recycling and extraction of critical minerals from eligible waste streams. The scheme focuses on improving India’s domestic supply chain for strategic minerals used in electric vehicles, renewable energy systems, electronics manufacturing, semiconductors, aerospace applications, and advanced battery technologies.
Key areas supported under this initiative include:
- Lithium-ion battery recycling
- E-waste recycling
- Black mass recycling
- Critical mineral extraction
- Recovery of nickel, cobalt, lithium, graphite, copper, and rare earth elements
- Battery-grade material production
- Advanced metallurgical recycling technologies
The scheme is designed to encourage investment in recycling infrastructure while reducing dependence on imported minerals.
Target Segments Covered Under the Scheme
The scheme covers multiple recycling segments connected with critical mineral recovery.
1. Lithium-Ion Battery Recycling
This includes recycling of:
- Spent lithium-ion batteries
- EV battery scrap
- Black mass
- Battery manufacturing scrap
- LFP batteries
- NMC batteries
- Lithium cobalt oxide batteries
2. E-Waste Recycling
Eligible e-waste includes:
- Printed circuit boards
- Electronic assemblies
- Consumer electronics waste
- Electrical equipment waste
- Industrial electronic scrap
3. Other Critical Mineral Waste Streams
The scheme also supports recovery from:
- Catalytic converters
- Permanent magnets
- Solar waste
- Superalloy scrap
- Metallurgical residues
Financial Incentives Under the Critical Mineral Recycling Incentive Scheme
One of the biggest advantages of the Critical Mineral Recycling Incentive Scheme is the availability of both CAPEX subsidy and OPEX incentive support.
The financial incentive structure is specifically designed to support greenfield recycling projects, expansion projects, and modernization of recycling units.
CAPEX & OPEX Incentives
Incentive Type | Beneficiary Group | Incentive Details | Maximum Incentive |
CAPEX Subsidy | Group A | Incentive on eligible capital investment for large recycling projects | Up to ₹50 Crore |
CAPEX Subsidy | Group B | Incentive on eligible investment for MSME and smaller projects | Up to ₹25 Crore |
OPEX Incentive | Group A | Operational subsidy linked with incremental sales | Up to ₹10 Crore |
OPEX Incentive | Group B | Operational subsidy linked with production growth | Up to ₹5 Crore |
The scheme provides financial assistance based on investment size, recycling capacity, commercial production timelines, and incremental sales.
CAPEX Subsidy Rates
The CAPEX subsidy rate depends on the speed of commercial production commencement.
Project Category | Commercial Production Timeline | Subsidy Rate |
New Unit with Environmental Clearance | Within 18 Months | 20% |
New Unit with Environmental Clearance | After 18 and before 24 Months | 17% |
New Unit with Environmental Clearance | After 24 Months | 14% |
New Unit without Environmental Clearance | Within 12 Months | 20% |
New Unit without Environmental Clearance | After 12 and before 18 Months | 17% |
New Unit without Environmental Clearance | After 18 Months | 14% |
Expansion Unit without Environmental Clearance | Within 8 Months | 20% |
Expansion Unit without Environmental Clearance | After 8 and before 12 Months | 17% |
Expansion Unit without Environmental Clearance | After 12 Months | 14% |
This structure encourages faster commissioning of recycling projects.
OPEX Incentive Structure
The OPEX incentive is linked with incremental sales and operational growth.
Financial Year | Incentive on Eligible OPEX | Incremental Sales Threshold – Group A | Incremental Sales Threshold – Group B |
2027-28 | 40% | ₹60 Crore | ₹30 Crore |
2030-31 | 60% | ₹150 Crore | ₹75 Crore |
The operational incentive helps recycling businesses improve project viability during the early years of commercial operations.
Eligibility Criteria for the Critical Mineral Recycling Incentive Scheme
The eligibility requirements are technical, and investment focused. Therefore, businesses should carefully evaluate compliance before applying.
Minimum Capacity & Investment Requirement
Beneficiary Type | Capacity Threshold | Minimum Investment Threshold |
Group A | 10 KTPA | ₹100 Crore |
Group B | 5 KTPA | ₹25 Crore |
The scheme classifies applicants based on Global Manufacturing Revenue (GMR).
Group | Revenue Criteria | Recycler Type |
Group A | Equal to or more than ₹200 Crore | Large & established |
Group B | Below ₹200 Crore | MSME & Startup |
Eligible Recycling Technologies
The scheme encourages advanced recycling technologies for better mineral recovery efficiency.
Eligible technologies include:
- Hydrometallurgy
- Pyrometallurgy
- Electrometallurgy
- Advanced separation technology
- Chemical extraction
- Solvent extraction
- Electro-winning systems
- Black mass refining
- Metal recovery systems
Projects based only on dismantling, crushing, or segregation without refining may not qualify for incentives.
Eligible Critical Minerals
The scheme supports recovery of several critical minerals including:
- Lithium
- Nickel
- Cobalt
- Copper
- Graphite
- Rare Earth Elements (REE)
- Platinum Group Metals
- Gallium
- Germanium
- Tantalum
- Selenium
- Tellurium
- Tin
- Indium
These minerals are essential for EV batteries, semiconductors, electronics manufacturing, renewable energy systems, and defense applications.
Black Mass Recycling Subsidy
Black mass recycling has become one of the most attractive sectors under the Critical Mineral Recycling Incentive Scheme.
This battery-processing material contains valuable minerals such as:
- Lithium
- Nickel
- Cobalt
- Manganese
- Graphite
The scheme allows subsidy support for advanced black mass recovery and refining facilities. Since India’s EV market is expanding rapidly, black mass recycling projects are expected to receive strong industry attention over the next few years.
Businesses investing in black mass refining plants can benefit from:
- CAPEX subsidy support
- OPEX incentives
- Recovery-linked incentives
- Advanced technology support
- Strategic industry positioning
Lithium-Ion Battery Recycling Subsidy in India
Lithium-ion battery recycling is one of the most important focus areas under the scheme.
The government is promoting domestic recycling to recover valuable minerals from EV batteries and industrial battery waste.
Under the lithium-ion battery recycling subsidy framework, businesses can establish:
- EV battery recycling plants
- Black mass processing units
- Battery-grade lithium recovery plants
- Nickel and cobalt recovery units
- Battery scrap processing facilities
The subsidy structure improves project feasibility and reduces capital burden during the initial years.
E-Waste Recycling Incentive Scheme India
India generates large quantities of electronic waste every year. Therefore, the government is encouraging organized recycling infrastructure through the e-waste recycling incentive scheme India.
The scheme supports:
- PCB recycling
- Precious metal recovery
- Copper recovery
- Rare earth extraction
- Industrial electronics recycling
- Electronic assembly recycling
Businesses involved in e-waste processing can benefit from both investment support and operational incentives.
Conclusion
The Critical Mineral Recycling Incentive Scheme is one of India’s most important recycling-focused subsidy programs for the EV and advanced manufacturing ecosystem.
With attractive CAPEX subsidy support, OPEX incentives, black mass recycling benefits, and lithium-ion battery recycling assistance, the scheme creates major opportunities for businesses planning recycling projects in India.
If you are planning a lithium-ion battery recycling plant, e-waste recycling unit, or critical mineral recovery project, professional guidance can significantly improve your project’s approval potential and financial outcome.
Call us now: +91 9373114747 or visit finraja.com/contact for quick assistance.
