Cabinet approves Rs 34,300 crore for National Critical Mineral Mission

Financial incentives, fast-track approval, mineral pacts with foreign nations planned

Aimed at encouraging the Indian government and private companies to acquire critical mineral assets abroad, enhance trade with resource-rich countries, and establish a stockpile at home, the Cabinet on Wednesday approved the National Critical Mineral Mission at a cost of Rs 34,000 crore.

 

To be implemented by the Ministry of Mines over seven years until 2030-31 (FY31), the mission will have an outlay of Rs 16,300 crore, including Rs 2,600 crore as budgetary support. In addition, Rs 18,000 crore investment is expected from public sector undertakings (PSUs). Spanning the entire value chain across exploration, mining, beneficiation, processing, and recovery of critical minerals, the mission aims to develop a comprehensive strategy for achieving self-reliance in critical minerals. 

Scaling up exploration efforts, the mission will offer financial incentives for critical mineral exploration and promote the recovery of these minerals from overburden and tailings. A fast-track regulatory approval process for mining projects will be established. The Centre has targeted 1,200 exploration projects to be auctioned by FY31, alongside more than 100 blocks of critical mineral resources. In addition to the lack of clarity on reserves, the high cost of investment in exploration has so far deterred potential investors from participating in the bidding process. 

 

Setting sights on foreign deposits 

Resources located abroad are especially in focus. “The government will motivate central PSUs and encourage private sector companies to allocate funds for acquiring critical mineral assets overseas, empowering central PSUs, their joint ventures, and subsidiaries to invest abroad by issuing necessary guidelines,” a detailed brief by the mines ministry said. The government will provide targeted subsidies for mining and the establishment of evacuation infrastructure. Khanij Bidesh India (KABIL), a joint venture of government mining companies, has acquired brine-type lithium assets in Argentina. 

Meanwhile, the Centre will aim to enter into critical minerals partnership agreements with resource-rich countries while working to include critical minerals chapters in existing trade pacts with countries of interest, the ministry said. 

The mission includes provisions for the setting up of mineral processing parks and supporting the recycling of critical minerals. To promote research in the sector, the government will support patent filing procedures for innovators and startups and set up a Centre of Excellence on Critical Minerals.

 

The government released its first list of critical minerals in July 2023, underscoring its focus on resources like rare earth elements, lithium, molybdenum, potash, tungsten, and graphite. These, and other critical minerals, are crucial for strategic industries such as electronics, telecommunications, transport, agriculture, defence, medicine, and critical emerging technologies for clean energy transition.

 

The Mines and Minerals (Development and Regulation) Act, 1957, was amended in 2023 to give the sector an impetus, with the mines ministry subsequently auctioning off 24 of the 49 strategic mineral blocks it had offered for bidding. These included key resources like lithium, graphite, phosphorite, and glauconite.

 

Over the past three years, the Geological Survey of India (GSI) has undertaken 368 exploration projects for critical minerals, with 195 projects currently underway in 2024-25. In the next financial year, GSI will take up 227 projects for various critical minerals, the ministry said.