₹2,800-crore plan to process lithium and nickel in India
The Union Cabinet is likely to take up a scheme of about ₹2,800 crore to help build lithium and nickel processing plants in India. These metals go into batteries for phones and electric vehicles. China controls about 90% of global processing today. Read it to revise critical minerals and the National Critical Mineral Mission.
- Scheme size
- About ₹2,800 crore
- Plants
- 2 lithium + 2 nickel
- Subsidy
- 30% of investment
- By-product
- Cobalt
The critical minerals plan: what happened?
Every electric scooter in India runs on a battery whose minerals were most likely processed in China. This scheme wants to change that.
- The Union Cabinet is likely to take up the ₹2,800-crore scheme on Wednesday.
- It will give capital support for two lithium plants (at least 30 kilotonnes each) and two nickel plants (at least 50 kilotonnes each).
- The subsidy is 30% of investment: up to ₹500 crore per lithium firm and ₹900 crore per nickel firm.
- Cobalt will come out as a by-product of nickel processing.
What are critical minerals?
Critical minerals are minerals vital for the economy and security, with a risk of supply shortage. Lithium, nickel and cobalt are key battery minerals.
Mining is only half the story. Processing turns ore into battery-grade metal, and China controls about 90% of it worldwide.
The National Critical Mineral Mission plans a stockpile, with ₹500 crore for 2024-25 to 2030-31.
Planned processing parks
| Mineral | State |
|---|---|
| Rare earths | Gujarat, Andhra Pradesh |
| Nickel | Odisha |
| Lithium | Maharashtra |
Which laws and Articles apply?
- Mines and Minerals (Development and Regulation) Act, 1957: amended in 2023 to let the Centre auction critical minerals.
- National Critical Mineral Mission: launched to secure supply chains.
- Union List Entry 54: regulation of mines and mineral development.
- Production Linked Incentive for Advanced Chemistry Cell batteries.
Why does the lithium and nickel processing plan matter?
| Angle | What to note |
|---|---|
| Energy security | Batteries are key to electric vehicles and solar storage. |
| Strategic | Cuts dependence on China. |
| Industry | Builds a domestic value chain. |
| Climate | Supports clean energy targets. |
What are the problems with the lithium and nickel processing plan?
- India has limited lithium and nickel reserves.
- Processing needs high technology and power.
- Plants can pollute water and land.
- Global prices are volatile.
What should be done next on the lithium and nickel processing plan?
- Secure ore from friendly countries.
- Bring in processing technology.
- Set strict environment rules.
- Build the stockpile on time.
What can Prelims ask on the lithium and nickel processing plan?
Prelims probability: Expect a question on battery minerals (lithium, nickel, cobalt) and the countries rich in them.
- Lithium, nickel, cobalt: battery minerals.
- China controls about 90% of global processing.
- National Critical Mineral Mission: plans a stockpile.
- MMDR Act amended in 2023 for critical minerals.
- Australia, Chile and Argentina are big lithium producers.
How to write about the lithium and nickel processing plan in Mains
Practice question (15 marks, 250 words): Critical minerals are the new oil. Examine India’s strategy to secure battery mineral supply chains.
- Intro: ₹2,800-crore scheme.
- Why critical minerals matter.
- India’s steps.
- Challenges.
- Conclusion: self-reliance in clean energy.
Ready lines for your answer
- Whoever controls minerals controls the clean energy future.
- Mining is not enough; processing is power.
Quotable data pointChina controls about 90% of global critical mineral processing.
Photo: Shannon Heinle, CC0, via Wikimedia Commons
Exam angle
Prelims: battery minerals, NCMM. · Mains GS-III: resource security.
Practice MCQs
Original practice questions (not PYQs).
Which country produces about three-fourths of the world's cobalt, a metal used in battery cathodes?
Answer (c) & explanation
The Democratic Republic of the Congo mines about three-fourths of the world's cobalt. Chile is rich in lithium and Indonesia in nickel.
In 2023, the Ministry of Mines released a list of how many critical minerals for India?
Answer (a) & explanation
In June 2023, India named 30 critical minerals, including lithium, nickel, cobalt, graphite and rare earth elements.
Questions students ask about this
What is the size of the scheme?
About ₹2,800 crore.
How many plants will it support?
Two lithium and two nickel processing plants.
Which by-product will come from nickel processing?
Cobalt.
Which country dominates global processing?
China, with about 90%.