Critical ban: On recycling of lithium-ion batteries

On November 10, the Directorate General of Foreign Trade banned the export of lithium-ion battery black mass by moving it from the “free” to the “prohibited” list of exports. Black mass is an intermediate product when spent batteries and factory scrap are shredded. It contains valuable lithium, nickel, cobalt, manganese and graphite. The Commerce Ministry says the ban will ensure feedstock for domestic refiners, lift their capacity utilisation and draw investment. While the recycling of lead-acid batteries end-to-end is an established ecosystem and formalised, too, lithium-ion battery recycling is an emerging segment with only a few dozen licensed operators but has much potential given the scale of use of such batteries in EVs. While the ban will redirect supply, it will not automatically create a market and ecosystem. Just banning export without creating an entire ecosystem will only lead to dumping of lithium-ion batteries into landfills if the blackmass has no market. Blackmass production is a largely mechanical process but further downstream processing is more specialised chemical processing requiring larger investment and further policy support. If downstream units are online, their output can directly feed into indigenous lithium-ion battery manufacture.India depends heavily on imports for critical minerals such as those used in battery inputs. Beyond working on supply aspects, the government must address the price gap to create a robust recycling market. Under the Battery Waste Management Rules, 2022, producers buy extended producer responsibility (EPR) certificates from recyclers but these are undervalued. Cheap certificates reward recycling on paper over investment in high-yield plants. A floor price that covers the full cost of recovery, with digital tracking, would fix that. Rare earths show how recycling remains a missed opportunity for India because of policy gaps. A smartphone can be up to 1% neodymium-iron-boron magnet by weight. That puts its rare earth content at about 3,000 parts per million, comparable to India’s monazite beach sands. Extracting it takes less energy than mining. A magnet separated from the phone is about 30% rare earth. Magnets make up as much as 3% of a hard drive, but are usable only if they are removed before the drive is shredded for data destruction. Yet the e-waste rules do not require rare earth separation. Rare earths need a separate EPR category, too. Payment by weight cannot be applied for rare earth minerals. Published - November 14, 2026 12:30 am IST