Cabinet to consider capex support for critical minerals processing capacity

The Cabinet is expected to examine a comprehensive support framework aimed at bolstering India's critical minerals processing capabilities, addressing a key gap in the country's supply chain for essential materials used in electronics, batteries, and advanced manufacturing.

Under the proposed scheme, financial assistance would cover approximately 30% of capital expenditure required to establish processing plants for critical minerals, according to sources familiar with the matter. This support structure is designed to make domestic processing projects economically viable and competitive with international alternatives.

The deliberations will also encompass viability gap funding (VGF) mechanisms for grid-scale energy storage systems utilizing renewable sources. This component aims to facilitate the integration of renewable energy into India's power infrastructure while supporting the capital-intensive storage technology segment.

The initiative reflects India's strategic push toward self-reliance in critical minerals processing, reducing dependence on imports and strengthening domestic manufacturing capabilities. Critical minerals are essential for electric vehicle batteries, renewable energy systems, telecommunications equipment, and defense applications.

The scheme's approval would signal the government's commitment to developing a complete value chain for critical minerals domestically, creating manufacturing capacity that can support India's growing energy transition and industrial objectives over the coming years.