India plans critical mineral recycling scheme amid China supply worries
New Delhi: Amid concerns of rare earth magnet supplies from China, the Union ministry of mines is finalizing an incentive scheme for recycling critical minerals that are used in their manufacturing, top government officials said. The minerals under consideration for recycling include neodymium, dysprosium, terbium and samarium.
Speaking to mediapersons in Delhi on the sidelines of a seminar on critical mineral processing, V.L. Kantha Rao, secretary to the ministry of mines, said that a scheme with an allocation of about ₹1,500 crore is in approval stage with the ministry and would also require the nod of the Union cabinet.
'We have thought of incentivizing the recycling of critical minerals. Rare earths are part of critical minerals. If someone says I can recycle old permanent magnets, which is very difficult and says that I would recycle neodymium or one of these four rare earths, then we will incentivize them. The scheme is yet to be approved. It's in the process of seeking approval," Rao said.
Addressing the event, Dinesh Mathur, joint secretary to the mines ministry, also said that the scheme is in 'final stages."
Also read: China restricts rare earth exports: Will it put the brakes on India's EV ambitions?
Further, the mines secretary told mediapersons that the ministry is planning to amend the Mines and Minerals (Development and Regulation) Act to support the extraction of mine tailings, which are waste material left over after the extraction of minerals.
'Critical minerals require certain amendments in the Act and we will take some amendments to the monsoon session (of Parliament) hopefully. The finance minister (Nirmala Sitharaman) had earlier said that there should be a tailing policy...So, if you are doing Manganese mining, you can extract Cobalt out of the dump. If you are doing Bauxite mining, from that red mud you can extract Gallium. Basically, we want to incentivize all these trace, critical minerals that are associated with bulk minerals. For that we will have to bring in a royalty structure which is attractive," Rao said.
The National Critical Mineral Mission also talks about the regulatory regime to be relaxed to encourage optimum recovery of critical minerals from various sources such as overburden, tailings, fly ash, red mud, and existing mines.
Industry supportive of move
Speaking to Mint, Pratyush Sinha, vice president, special projects at Lohum, a critical minerals refining and processing company, said the scheme would help India's nascent mineral recycling industry stand on its feet and grow over the next few years to cater significantly to the domestic requirement.
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'This is going to be a major scheme for the entire industry. China has an upper hand as companies there have enjoyed several state benefits. The scheme will help the industry as it is still in the initial stages compared to the magnitude in China. So, it will help in bridging the gap till the sector becomes independent. Although initially recycling of critical minerals will only remain a small part of the overall critical mineral business and demand requirement, going ahead it would take a greater share," Sinha said.
The background
The development comes at a time when India's automobile industry is struggling to source rare earth magnets from China.
On 5 June, Mint reported that applications from India for rare earths remain stuck even as China has resumed exports to other countries. Auto industry representatives told the ministry of heavy industries on 29 May that India's production of conventional and electric vehicles could be hit as early as this month if China doesn't resume exports of rare earth magnets to the country soon.
An industry executive said that the supplies of rare earth magnets with the India auto industry currently are adequate for about four weeks.
To be sure, China has a monopoly on rare earth magnets, essential for manufacturing of electric-vehicle motors and other auto components.
More moves
Media reports suggest that the Centre is also considering an incentive scheme to boost manufacturing of rare earth magnets in the country.
Recycling of critical minerals is a key initiative under the ₹16,300 crore National Critical Minerals Mission approved by the Union cabinet in January this year. The mission also laid down a plan for formulation of guidelines for recycling of critical minerals to streamline the informal mineral recycling sector in the country.
Although India has nearly 7 million tonnes of rare earth reserves, mining of these reserves have not picked up amid lack of investor interest. Plus, the country currently does not have a technology used at mass scale to develop rare earth magnets.
Also read: Donald Trump reveals 'very good' call with Xi Jinping, accepts invitation to visit China with Melania
Officials aware of the development said that state-run Non Ferrous Materials Technology Development Centre has created a technology to develop rare earth magnets and it may become commercially available within the next six months.
India has been in the pursuit of self-dependence in the space of critical minerals as the these minerals are required in several key and strategic sectors including renewable energy, electric mobility, batteries, defence and telecommunications. Apart from efforts to boost domestic production of these minerals including lithium, cobalt, manganese, Centre has also been encouraging India public sector and private sector to look at acquiring assets abroad.
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