Suryaa Business Desk: India has initiated a strategy to strengthen its battery supply chain for electric vehicles and green energy sectors. The Union Cabinet has approved a capital support scheme worth Rs 2,814 crore to establish two lithium and two nickel processing refineries in the country. This initiative aims to address the lack of domestic middle-processing facilities for critical minerals.
The scheme will be implemented over five years, from the 2026-27 financial year to 2030-31. The government will provide a capital subsidy of up to 30 percent of the construction cost for these four refineries. Under this plan, each lithium processing plant can receive a maximum incentive of Rs 500 crore, while each nickel plant can receive up to Rs 900 crore. The Ministry of Mines has mandated that lithium plants must have an annual processing capacity of at least 30,000 tonnes, and nickel units must have a capacity of at least 50,000 tonnes. The government expects this support to attract approximately Rs 10,000 crore in private investment.
Currently, India possesses battery cell assembly units but lacks commercial refineries to convert raw minerals into battery-grade chemicals. Consequently, the country relies heavily on imports from China for refined lithium, nickel, and cobalt. Domestic refineries are intended to provide raw material security for local electric vehicle manufacturers amid global geopolitical tensions and export restrictions. Experts note that alongside establishing refineries, India faces the challenge of securing raw mineral supplies through agreements with countries such as Australia, Indonesia, and Argentina, as well as acquiring necessary processing technology.