SF Prep Notes

Cabinet approves ₹1,500 crore incentive scheme for critical mineral recycling

The Union Cabinet on 3 September 2025 approved a ₹1,500 crore incentive scheme under the National Critical Mineral Mission to build capacity for extracting critical minerals from e-waste, battery scrap and other secondary sources.

Summary

The Union Cabinet chaired by Prime Minister Narendra Modi approved a ₹1,500 crore Incentive Scheme on 3 September 2025 to develop recycling capacity for the separation and production of critical minerals from secondary sources. The scheme is part of the National Critical Mineral Mission (NCMM) and runs for six years, from FY 2025-26 to FY 2030-31. Eligible feedstock includes e-waste, lithium-ion battery scrap and other scrap such as catalytic converters from end-of-life vehicles; one-third of the outlay is earmarked for small and new recyclers, including start-ups. Incentives comprise a 20% capex subsidy on plant and machinery and an opex subsidy linked to incremental sales, with a total ceiling of ₹50 crore per large entity and ₹25 crore per small entity. Only the value chain involved in actual extraction of critical minerals is covered, not black mass production alone. The scheme is expected to create at least 270 kilo tonnes of annual recycling capacity, about 40 kilo tonnes of annual critical mineral production, around ₹8,000 crore of investment and close to 70,000 jobs.

Key facts

Approved
3 Sep 2025, Union Cabinet
Outlay
₹1,500 crore; part of National Critical Mineral Mission
Tenure
FY 2025-26 to FY 2030-31 (six years)
Feedstock
E-waste, Li-ion battery scrap, other scrap e.g. catalytic converters
Small recyclers
One-third of outlay earmarked (incl. start-ups)
Incentives
20% capex subsidy + opex subsidy; ceiling ₹50 cr (large) / ₹25 cr (small)
Expected outcomes
270 kt recycling capacity; ~40 kt minerals; ~₹8,000 cr investment; ~70,000 jobs

Practice MCQs 4 questions

Q1

What is the outlay of the critical mineral recycling incentive scheme approved by the Union Cabinet on 3 September 2025?

Show answer

Correct answer: B — ₹1,500 crore

The Cabinet approved a ₹1,500 crore Incentive Scheme to develop critical mineral recycling capacity.

Q2 Advanced

The critical mineral recycling incentive scheme approved in September 2025 is part of which mission?

Show answer

Correct answer: C — National Critical Mineral Mission

The scheme is part of the National Critical Mineral Mission (NCMM), aimed at domestic capacity and supply chain resilience in critical minerals.

Q3 Advanced

What share of the critical mineral recycling scheme's outlay is earmarked for small and new recyclers, including start-ups?

Show answer

Correct answer: D — One-third

One-third of the scheme outlay has been earmarked for small, new recyclers including start-ups.

Q4 Advanced

Consider the following statements about the critical mineral recycling incentive scheme approved in September 2025: 1. Units engaged only in black mass production are eligible for incentives. 2. The total incentive per large entity is capped at ₹50 crore. Which of the above is/are correct?

Show answer

Correct answer: B — 2 only

The scheme covers only the value chain involved in actual extraction of critical minerals, not black mass production alone, so statement 1 is wrong. Total incentive is capped at ₹50 crore for large entities and ₹25 crore for small ones.

← All current affairs