Centre to offer financial support to boost critical minerals sector growth

The Centre plans to offer financial incentives for the development of critical minerals such as lithium, said Veena Kumari Dermal, joint secretary in the Ministry of Mines on Wednesday.

The efforts are aimed at encouraging the critical minerals industry towards self-reliance and reducing the country’s near-total dependence on imports. The incentive includes providing funding for research institutes to give technical assistance to miners.

The initiative could be worth up to $50 million. The development comes after earlier efforts to advance the sector did not produce the desired results. In June, the Centre granted development rights for a lithium block in Chhattisgarh, but a similar attempt in Jammu and Kashmir failed to attract interest due to financial feasibility concerns.

Advancing critical mineral extraction

As the world continues to reel under the impact of climate change, lithium and rare earth minerals have become increasingly crucial for advancing energy transition technologies.

The focus of this initiative is to help find ways to develop extraction technology and better methods of beneficiation, or the improvement of mineral ores before processing into metals, a government source told news agency Reuters.

On July 11, the ministry issued a letter, directing the CSIR-National Institute for Interdisciplinary Science and Technology (NIIST) to provide miners with know-how to extract critical minerals.

Guidance on mineral extraction funding

The letter highlighted that these minerals are often found in combination with other minerals and metals, necessitating the need for specific extraction techniques. Since most of these minerals are not extracted within India, the process requires “support and guidance on extraction and beneficiation techniques.”

Similar letters were sent to five different research institutes as well. Under the scheme, institutes and companies are required to send joint proposals and if approved, would get up to 75 per cent of the total funding.

(With inputs from Reuters)