Union Cabinet approves Rs 2,814 crore scheme for lithium and nickel processing plants

Why in news

The Union Cabinet approved a Rs 2,814 crore capex support scheme to establish four processing plants for lithium and nickel to reduce import dependence.

Background

The scheme provides a 30% capital subsidy for two lithium and two nickel processing plants. Financial support is capped at Rs 500 crore per lithium beneficiary and Rs 900 crore per nickel beneficiary until 2030-31.

Facts for Prelims

• FactTotal outlay for the critical minerals processing scheme is Rs 2,814 crore.
• FactCapital subsidy provided for processing plants is 30% of eligible investment.
• FactMaximum capital support cap is Rs 500 crore for lithium and Rs 900 crore for nickel beneficiaries.
• FactThe scheme aims to establish a total of four processing plants (2 lithium, 2 nickel).
• FactThe scheme period extends until the financial year 2030-31.

For Mains

Q. Discuss how the development of domestic value chains for critical minerals like lithium and nickel is essential for India's economic sovereignty and decarbonisation goals.

Dimensions to cover in your answer

• Supply chain vulnerability: High concentration of mineral processing in few global locations creates geopolitical risks.
• Economic sovereignty: Reducing import dependence on refined intermediates to secure the electric mobility and electronics sectors.
• Decarbonisation bottleneck: Nascent domestic beneficiation infrastructure limits the timely delivery of net-zero targets.

Keywords: Critical Minerals · Value Chain · Import Substitution · Decarbonisation · Economic Sovereignty · Capital Subsidy

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