India Critical Minerals Manufacturing
A Market Signal No Entrepreneur Should Ignore
India’s industry is at a turning point in history. The Economic Times has brought out the following revelations from a ground-breaking report by Grant Thornton Bharat in the last 24 hours that have brought every founder, MSME owner and industrial investor to a standstill.
The report, which was prominently featured in Economic Times Manufacturing, finds that the demand for critical minerals such as lithium, cobalt, nickel, graphite, copper and rare earth elements is projected to increase four to ten times by 2047 in the country. It is not incremental growth. This is a structural change in the Indian economy.
India has set a goal of 500 GW non-fossil fuel generation by 2030. It has committed itself to a Net Zero status by 2070. It is actively promoting electric mobility. Each and every one of these national aspirations cannot be achieved without the use of critical minerals. Nowadays, however, India has to import 100% of its lithium, cobalt and nickel needs.
This divide between unprecedented demand for processing and virtually no domestic processing capacity is not a policy issue to watch from the sidelines. It is the biggest manufacturing business opportunity at this moment in the industrial landscape of India — and the window to “enter early” is open.
What Recent Economic Times Reporting Means for Entrepreneurs
India’s Critical Minerals Demand: A report in the Economic Times (Published: 30-31 July 2026) is much more than a policy briefing. It serves as a market signal of extraordinary clarity for manufacturing entrepreneurs.
Here’s what Grant Thornton Bharat discovered and how it will impact the next business decision you make:
- The demand for EVs alone could be 110–130 GWh up to 2030. It takes thousands of tonnes of refined lithium, cobalt and graphite to produce each gigawatt-hour.
- Copper demand will rise over five times by 2047. Currently, India imports very little copper itself due to the scarcity of the material in the country.
- Overall demand for selected critical minerals is expected to reach 6 to 8 million tonnes by the early to mid-2040s, which represents a small fraction of today’s demand.
- Mineral resources are not enough; India needs to develop its own capacity to explore, refine, process and recycle them, and to have financial resources to support all of the above.
The firm outlined a three-phase roadmap to 2047: Foundation-building (2026–31), Scale-up (2031–40), and Leadership (2040–47). The first phase of the foundational phase starts now. It’s the perfect time for entrepreneurs to make manufacturing moves.
The ET Market Signal is ‘Unambiguous’: India must develop domestic manufacturers in critical mineral processing, refining & recycling. The government will incentivize, subsidize and support early entrants to this space.
Why Critical Mineral Manufacturing Is Growing at an Unprecedented Pace
The combination of three macro forces is creating the top opportunity for manufacturing critical minerals in the next ten years.
1 The Clean Energy Transition Is Non-Negotiable
To reach India’s renewable energy target of 500 GW by 2030, the country will need huge amounts of copper for transmission lines, rare earth magnets for wind power and lithium for grid-level battery storage. These are binding international agreements — not goals.
2 Electric Mobility Is Scaling Faster Than Expected
EV market is growing in India rapidly. In many states, EV adoption of two and three-wheel vehicles is already commonplace. Growth in four-wheeler EV sales is 30-40% year-over-year. About 8-10 kg of battery-grade lithium compounds and considerable amounts of cobalt, nickel and graphite are needed for each EV. A consistent report by the Economic Times has it that the domestic battery manufacturing chain in India is unable to scale without having a secure chain of minerals.
3 Geopolitical Supply Chain Diversification
China’s share of critical mineral processing is now around 60-80%. Western economies and Japan are actively funding alternative processing hubs. India has 5.9 million tonnes of inferred lithium in Jammu & Kashmir and bilateral agreements with Australia, Argentina, Chile, and Zimbabwe, along with the National Critical Mineral Mission is making it a preferred alternative processing destination.
Government Policies and Incentives Supporting the Sector
1 National Critical Mineral Mission (NCMM)
The NCMM has dedicated ₹500 crore for the Circular Mineral Processing Zones. The Make in India site offers facilitative information for investors on sector-wise information.
2 Production-Linked Incentive (PLI) Schemes
The total outlay for the PLI schemes for Advanced Chemistry Cell batteries is ₹18,100 crore. Manufacturers that supply processed minerals to battery plants supported by PLI receive additional incentive linkages.
3 MSME Credit and Technology Schemes
The Ministry of MSME provides CGTMSE credit guarantees, the Technology Upgradation Fund, and the MSME Cluster Development Programme — all highly relevant for mineral processing startups needing capital and technology access.
4 Startup India Benefits
The 80-IAC tax exemptions for 3 years, fast-track patent applications and benefits in government procurement are available to critical mineral processing startups who register under Startup India.
5 Extended Producer Responsibility (EPR) for Batteries
EPR is one of the key drivers of the foundation-phase policy, as identified in the Grant Thornton Bharat report. EPR will require battery manufacturers to make batteries recyclable from 2026–31 from a specific percentage of batteries sold, and will provide legally guaranteed feedstock for battery recycling manufacturers.
Top 6 Manufacturing Business Ideas for Startups and MSMEs
Grant Thornton Bharat identified each of the following business ideas through its findings, as mentioned in The Economic Times. These opportunities are not random; they address manufacturing gaps that align with forecasted demand.
Business Idea 1: Lithium Compound Processing Unit
How it works: Extracting lithium ore concentrates or lithium brine into two main products needed for battery cell manufacturers, lithium carbonate (Li₂CO₃) or lithium hydroxide (LiOH).
Why now: At present, India requires 100% of its current demand for battery-grade lithium from imports. There is a need to set up the processing infrastructure for domestic lithium with 5.9 Mn tonnes of inferred resources in J&K.
Investment requirement: Pilot scale: ₹3-8 crore; Commercial scale: ₹25-50 crore.
Market: EV battery manufacturers under PLI Scheme; Grid storage manufacturers.
Government support includes LCPD allocations for the NCMM, SIDBI green energy MSME loans, and PLI subsidy for battery cell linkage.
Get Detailed Project Report (DPR): Lithium Battery Business & Manufacturing Guide
Business Idea 2: Battery Black Mass Recycling Plant
What it is: Black mass is a crushed and powdered material that can be recovered from spent lithium-ion batteries that includes lithium, cobalt, nickel and manganese. A processing plant extracts and purifies these minerals to be used again in new batteries.
Why now: The scheme Critical Mineral Recycling Incentive Scheme (CMRIS) by government is in place with 58 recyclers already approved. Newcomers today are still just around the corner and getting a warm welcome.
Cost of investment: ₹1 to 3 crores for primary processing, ₹5 to 15 crores for complete hydrometallurgical refinement.
Domestic battery manufacturing, export of battery-grade minerals to Japan, South Korea and Europe.
Business Idea 3: Graphite Purification and Anode Material Manufacturing
What it requires: To make it into battery anode material, the natural graphite needs to be treated to 99.95%+ purity, a process that most small-scale manufacturers do not employ and which presents an opportunity for specialists.
Why now: India has reserves of natural graphite in the states of Jharkhand, Arunachal Pradesh and Tamil Nadu. Currently battery-grade graphite anode material is practically all provided by China. Domestic manufacturing captures the entire value of imports as soon as they are produced.
Investment scale: Mid-range purification plant is Rs 4-10 cr.
Target markets: Pouch cell and cylindrical cell manufacturers, EV OEMs establishing in-house manufacturing batteries.
Business Idea 4: Rare Earth Magnet Component Manufacturing
Its applications include EV motors, wind turbine generators, defence systems, etc., and rare earth magnets (NdFeB – Neodymium-Iron-Boron) are also crucial to these areas. The manufacturing of rare earth oxides (REOs) into magnet blanks, ring magnets and arc magnets is a high value, high demand activity.
Why now: India is finalizing a PLI-like incentive package for the production of REMs worth $290 million. There is an estimated 7.23 MT of rare earth oxides in monazite deposits. This is an attractive combination thanks to the raw material advantage and incoming subsidy.
Investment size: Rs 8 – 20 crores for the medium to a medium-large magnet production plant.
Industry: Export to Japan and Germany, defence OEMs, wind energy equipment manufacturers and the EV motor manufacturers.
Related Article: India’s ₹7,280-Crore Rare Earth Magnet Scheme: A Landmark Opportunity for Startups and MSMEs
Business Idea 5: Copper Wire Rod and Cathode Manufacturing
It’s used in: All electrical wiring, EV charging infrastructure, power transmission cables & manufacturing of transformers. The demand for copper is expected to grow by over five times by 2047, according to the Grant Thornton report.
Why now: India’s EV charging infrastructure rollout as per the National EV Policy 2024 is already demanding millions of kilometres of copper wiring. The demand for copper will grow in industrial machinery, with the use of steel expansion targets. This is a multi-decade guaranteed demand.
Investment amount: ₹5-15 crore for a small continuous casting and rolling plant.
The market: Cable Manufacturers, Transformer Manufacturers, EV Charging Station Builders, Export markets in South Asian and African countries.
Get Detailed Insights from This Book: The Complete Book on Ferrous, Non-Ferrous Metals with Casting and Forging Technology
Business Idea 6: Mineral Assay Testing and Quality Certification Laboratory
It requires the separate assessment of each tonne of critical mineral ore, concentrate, black mass and refined mineral to determine the material’s grade, purity and compliance before sale or export. All the value chain players benefit from an accredited mineral assay laboratory.
Why now: The critical mineral sector is growing at a rapid pace in India from 2026 and so is the number of testing facilities that are accredited by NABL. Currently most of the samples are sent to the limited facilities available at CSIR and GSI or to foreign labs.
Investment estimate: Rs 1 – 3 crores for a laboratory setup ready to perform the testing on NABL.
Applications: Mineral mining companies; battery recyclers; processing plants; Government auction validation; Export quality compliance.
Import–Export Opportunity Analysis
Import Substitution: Lithium compounds, cobalt sulphate, battery-grade graphite, and rare earth oxides are four such valuable imports currently worth thousands of crores that India depends on. Each domestic processing unit that replaces imports brings foreign exchange savings and develops local value chain.
Export Opportunity — Processed Minerals: As India develops the confidence of the refining process, it emerges as an alternative to China for battery manufacturers in Japan, South Korea, EU and the United States. Western battery supply chain policy now explicitly calls for vehicles sold in Europe and North America to be supply chain-free of China.
Indian exporters can utilise the existing mineral export framework to export recycled battery-grade lithium, cobalt and nickel — Export Opportunity — Recycled Minerals. Please check with DGFT for export Licensing and documentation requirements.
Strategic Trade Partnerships: India has inked bilateral critical minerals deals with Australia, Argentina, Peru, Chile, Zimbabwe, Mozambique, Malawi and Côte d’Ivoire, providing access to raw material supplies at negotiated terms for processing entrepreneurs.
Indian MSME and Startup Success Stories
1. Maharashtra-Based Battery Recycler Scales to ₹40 Crore Revenue
An MSME in Pune, which started its battery recycling journey in 2022, has now reached a stage where it is processing more than 500 tonnes of used lithium-ion batteries every month. The company will qualify for Capex and Opex subsidies under the formal CMRIS programme in its proposed expansion to full hydrometallurgical refining, Phase 2. Early market entry is the major competitive advantage according to the founder.
2. Gujarat Copper Products Manufacturer Enters EV Supply Chain
A Gujarat-based copper wire rod manufacturer pivoted from conventional electrical contractors to supplying copper busbars and winding wire to EV motor manufacturers. With Invest India facilitation support, the company accessed a ₹3 crore technology upgrade loan and now exports copper winding wire to Bangladesh and Sri Lanka.
3. Tamil Nadu Rare Earth Startup Wins Government Contract
In 2024, DSIR recognised a start-up founded by IIT-Madras alumni that develops rare earth separation technology using monazite-bearing beach sand. The startup is currently in a late-stage discussion with the Atomic Minerals Directorate for a pilot processing contract, offering a direct access to the rare earth value chain with government support.
Identify high-growth industries before others do
How Niir Project Consultancy Services (NPCS) Supports Critical Minerals Entrepreneurs
One of the questions that faces a lot of entrepreneurs when thinking of entering critical minerals manufacturing is where do they begin? What matters is whether a bank approves your loan or not, and it all depends on the documents you submit: Detailed Project Reports (DPRs), feasibility studies, plant layouts, guidance for sourcing machinery, licensing roadmaps and financial projections.
For more than 40 years, Niir Project Consultancy Services (NPCS) — one of the most trusted industrial consultancy and feasibility report providers in India — has been assisting manufacturing entrepreneurs, MSMEs and industrial investors. NPCS provides:
- Detailed Project Reports (DPRs) on Lithium Processing, Battery Recycling, Graphite Purification, and rare earth Manufacturing Plant
- Detailed information about sourcing machines and technology from Indian and International suppliers.
- Grant Thornton Bharat’s forecasts and Economic Times industry reports supported the market research, demand analysis, and financial projections.
- Feasibility report prepared by a bank acceptable to SIDBI, NABARD, nationalised banks and NBFCs accepted.
- Pre-investment consulting to assess your critical minerals business concept prior to investment
In a period where the Economic Times is releasing landmark reports on sector which may shape the Indian manufacturing industry over the coming 20 years, a viable DPR and feasibility report turns a business concept into a viable industrial project.
Key Data: India’s Critical Minerals Demand Forecast and Business Opportunity Overview
| Mineral | Import Dependency | Demand Growth by 2047 | Primary Use | MSME Entry Point |
| Lithium | 100% | 8–10x | EV Batteries, Grid Storage | Lithium Compound Processing |
| Cobalt | 100% | 5–7x | Battery Cathodes, Alloys | Black Mass Recycling Plant |
| Graphite | 90%+ | 6–8x | Battery Anodes | Graphite Purification Plant |
| Copper | 30–40% | 5x+ | Wiring, EV Motors, Transformers | Copper Rod/Cathode Mfg |
| Rare Earth | 95%+ | 4–6x | EV Motors, Wind, Defence | REE Magnet Manufacturing |
| Nickel | 100% | 4–5x | Battery Cathodes, Steel | Battery Recycling / Ni Sulphate |
Sources: Grant Thornton Bharat (July 2026); Economic Times Manufacturing; NITI Aayog Critical Mineral Assessment 2026; IEEFA India.
Frequently Asked Questions (Founder-Focused)
1. Do I need a mining licence to start a critical mineral processing business?
No. Processing and refining companies operate on mineral concentrates, black mass or intermediate mineral products provided by licensed miners or recyclers. Establishing a processing plant for lithium compounds, a battery recycling unit, or a rare earth purification plant does not require a mining licence. Manufacturers need standard manufacturing licenses and pollution control clearances. In the case of processing rare earths from monazite, they must also obtain approval from the Atomic Minerals Directorate.
2. In India, how much would be the minimum amount of investment required to open a battery recycling unit?
The cost of plant and machinery for a small-scale collection and black mass production unit is Rs. 1 – 2 crores. CMRIS incentive scheme Capex and Opex subsidies require a hydrometallurgical refining section making the entire project cost of ₹5–15 crore. For such projects, SIDBI also provides loans for green energy transition.
3. What are the incentives offered by the government for critical mineral processing MSMEs?
These key schemes include CMRIS (₹1,500 crore) for battery recycling, Circular Mineral Processing Zones under NCMM, linkages with the PLI scheme for battery material suppliers, the MSME Ministry’s credit guarantees under CGTMSE, green loans by SIDBI, and state-level schemes such as the Critical Mineral Processing Park in Odisha and the Viksit Gujarat Industrial Policy 2026 in Gujarat.
4. Is it feasible for a small MSME to compete in the critical minerals arena with big corporations?
Yes — and strategically. Upstream mining and large processing are the focus of large corporations. MSMEs have the greatest competitive advantage in: specialist mineral assay laboratories, battery collection and aggregation networks, small-scale black mass processing, graphite purification for niche battery grades, and rare earth magnet component manufacturing for defence and EV sub-assemblies.
5. How can I export processed minerals like critical ones from India?
The Foreign Trade Policy provides for critical mineral exports, which are under the control of DGFT. Processed battery grade materials (lithium carbonate, cobalt sulphate, battery grade graphite) typically have less restrictions than raw ore exports. For latest requirements for export license applicable to your mineral category, refer to dgft.gov.in.
6. What are the best states to start a critical mineral manufacturing business?
Odisha (Paradip Critical Mineral Processing Park), Gujarat (Viksit Gujarat Industrial Policy 2026), Jharkhand (graphite and mineral deposits), and Tamil Nadu (rare earth-bearing beach sands and an established MSME ecosystem) offer the best combination of these advantages.
Conclusion: The Economic Times Signal Points to One Direction — Act Now
The Economic Times report by Grant Thornton on July 30-31, 2026 is not a prediction of what will happen in 2047. It is a plan to action for 2026.
The demand for critical minerals will increase four to ten-fold in India. The government has allocated ₹1,500 crore for mineral recycling, ₹500 crore for processing zones, and $290 million for incentives for production of rare earth magnets. On a legal basis, EPR will mandate battery collection and recycling. India is brokering bilateral mineral agreements with more than eight countries to ensure a steady supply of raw materials. The country is also establishing all the components required to build a domestic ecosystem for critical mineral manufacturing.
The companies that come into this ecosystem during this building phase between 2026 and 31 will enjoy the benefit of first-mover advantage, government incentive priority, and multi-decade demand tailwinds which few Indian industrial sectors have been able to combine in one ecosystem.
The decade ahead will see a lot of entrepreneurs who read the market signals well and act in advance of the mainstream dictating India’s industrial narrative, as consistently reported by the Economic Times. Critical minerals manufacturing is today’s signal.
It’s not a question of whether this opportunity is real. It is confirmed by the Grant Thornton Bharat data and Economic Times reporting. The question is if you’re one of the founders who will take action at the very inception of the foundation.
