Supply chain, e-waste issues can hit critical mineral plan

The scheme provides a maximum incentive of ₹50 crore to eligible firms.

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Critical minerals recyclers are cautious about the prospects of the newly announced incentive plan for the sector.

Players say the informal e-waste collection system and the lack of a supply chain can hinder the government’s plan to establish a robust critical mineral extraction ecosystem in the country.

The mines ministry recently announced ₹1,500 crore sops for recycling of critical minerals. The scheme provides a maximum incentive of ₹50 crore to eligible firms.

According to Ravi Kumar Neeladri, CEO at Pegasus Waste Management, over 90 per cent of black mass-a powder extracted during battery recycling and containing metals such as copper, magnesium and cobalt-is currently exported in some way or the other, thus losing all the critical metals extraction in the country. But the critical mineral recycling scheme can lead to roughly half the country’s black mass output to be processed to extract the critical metals within the country in the next two to three years.

“The biggest challenge is the informal collection of e-waste, including batteries. There’s uncertainty around where recyclers will get feedstock from, what its quality will be,” he told ET.

The critical mineral recycling scheme is expected to spur the extraction of crucial elements such as lithium, nickel and cobalt from end-of-life batteries and gadgets. Recyclers expect the nascent industry to build capacity to meet at least 50 per cent of the country’s demand for critical minerals through recycling and extraction over the next decade.

“We need to acquire relevant technology for extracting and processing critical minerals,” said Yuvraj Bharadwaj, CEO of Plannex Recycling, adding this will create the demand for extracted elements but the ₹50 crore cap per beneficiary will need to be raised for effective implementation.Sector watchers also say the absence of technology and a skilled workforce are bigger challenges.