India’s federal Ministry of Mines is expected to soon unveil a new incentive policy aimed at boosting domestic processing of critical minerals such as lithium and nickel, with a proposed outlay of around Rs.3,000 crore, according to reports.

The move is part of the government’s broader strategy to strengthen the country’s electric vehicle (EV) supply chain and reduce dependence on imports for key battery materials.

According to reports, the policy is likely to focus on encouraging investments in large-scale processing facilities for the two minerals.

According to recent reports, the government was working on an incentive framework covering lithium and nickel processing. Further indications emerged in April when the mines secretary stated that two critical minerals linked to securing India’s EV value chain had been shortlisted for a dedicated processing policy.

Lithium and nickel play a crucial role in the production of advanced batteries used in electric vehicles. As India accelerates its clean mobility ambitions, demand for these minerals is expected to rise significantly.

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The government has set a target of achieving 30percent electric car penetration and 80percent adoption of electric two-wheelers by 2030, compared with current levels of around 6percent and 9percent, respectively.

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To qualify for incentives under the proposed scheme, lithium processing plants will reportedly be required to have a minimum annual capacity of 30,000 metric tons, while nickel processing facilities must have a minimum capacity of 50,000 metric tons.

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The policy is expected to support the development of a domestic critical minerals ecosystem, helping India secure supplies of essential battery materials and strengthen its position in the global EV manufacturing landscape.