National Critical Mineral Mission, higher ethanol procurement price get cabinet nod

The cabinet also approved an increase in the price of ethanol procured by state-run oil marketing companies (OMCs) for blending with petrol.

Of the critical mineral mission outlay, an amount of ₹16,300 crore will be borne by the government and the remaining ₹18,000 crore raised by public sector undertakings and other entities. 

The mission, proposed by finance minister Nirmala Sitharaman in the Union budget presented in July last year, aims to secure both domestic and foreign supplies of critical minerals by strengthening the value chains with better technological, regulatory, and financial ecosystems. 

India will foster innovation, skill development, and global competitiveness in exploration, mining, beneficiation, processing, and recycling to ensure it can efficiently meet both current and future demands, the government said.

Also read | Mining and steel firms in a limbo on tax uncertainty and weak prices

"The National Critical Mineral Mission, approved by the Union Cabinet, will encompass all stages of the value chain, including mineral exploration, mining, beneficiation, processing, and recovery from end-of-life products. The mission will intensify the exploration of critical minerals within the country and in its offshore areas. It aims to create a fast-track regulatory approval process for critical mineral mining projects," said an official statement.

It will also offer financial incentives for critical mineral exploration and promote the recovery of these minerals from tailings.

The key components of the mission are include: increasing domestic critical mineral production, acquisition of critical mineral assets abroad, recycling of critical minerals, boosting trade and markets for these minerals. Research and technological advancement of critical minerals, human resource development, effective funding, financing and fiscal incentives are also among the components of the scheme.

Out of the ₹16,300 crore expense of the government about ₹8,700 crore would go towards the National Mineral Exploration Trust, another ₹4,000 towards the Geological Survey of India, and ₹1,000 crore to the Anusandhan National Research Foundation and other R&D efforts.

Also read | India aims to secure critical minerals partnership with US, eyes trade benefits

Under the new mission, the government has targeted about 1,200 domestic exploration projects for critical minerals along with securing 50 mines abroad by FY31. In terms of recycling, the government aims to incentivize recycling of about 400 kilotonne of minerals. It would also set up four mineral processing parks and three centres of excellence by FY31.

While the Union ministry of mines will be the administrative ministry of the NCMM. its activities will be coordinated by an empowered committee chaired by the cabinet secretary.

A mission secretariat will be created, led by a joint secretary, who will serve as the mission head.

The government has been pushing for exploration and mining of critical minerals in the country, along with eyeing opportunities to acquire mines and undertake greenfield mining in mineral-rich countries like Argentina, Australia and Chile.

These critical minerals including lithium, nickel and graphite are key to several strategic and emerging sectors like renewable energy, defence, telecom  and medicine.

Also read | Critical minerals push to benefit battery-makers, electronics firms

With China having control of the critical mineral supply chain currently, India is looking at ways to become self-reliant in this space.

Rakesh Surana, partner, Deloitte India said: "Given the country’s vulnerability to geopolitical shifts surrounding critical minerals, this mission addresses a key area of concern. It is a well-timed and highly welcome move by the government, signaling a commitment to strengthening energy security in the face of global uncertainties."

He added that the "multi-faceted approach" will likely drive significant activity across sectors.

Ethanol procurement price

In another decision, the Cabinet Committee on Economic Affairs on Wednesday approved upward revision of the ethanol procurement price for OMCs for the Ethanol Supply Year (ESY) 2024-25 (November 2024 - 31 October 2025) under the Ethanol Blended Petrol (EBP) programme.

The administered ex-mill price of ethanol for the EBP programme derived from C Heavy Molasses (CHM) for ESY 2024-25 has been fixed at ₹57.97 per litre, up from ₹56.58 per litre in the previous supply year.

Also read | India steps up push for ethanol as fuel, automakers seek differential pricing

"In the interest of sugarcane farmers, as in the past, GST and transportation charges would be separately payable. Increase in prices of CHM Ethanol by 3% will assure sufficient availability of ethanol to meet the increased blending target," said an official statement.

The government has advanced the target of 20% ethanol blending in petrol from 2030 to ESY 2025-26. OMCs aim to achieve 18% blending during 2024-25.