Critical Minerals – The biggest roadblock to India’s net-zero goal

Source: The post Critical Minerals has been created, based on the article “The biggest roadblock to India’s net-zero goal” published in “Indian express” on 5th March 2024.

UPSC Syllabus Topic: GS Paper 3- Economy-Infrastructure: Energy

Context: This article discusses the global importance of critical minerals, which are essential for technologies like renewable energy and electric vehicles. It highlights the dominance of certain countries in mineral production and processing, particularly China’s control over rare earths.

What are Critical Minerals?

Critical Minerals are not clearly defined globally, but countries identify them based on their own needs. India has listed 30 such minerals, the US 50, and Japan 31. Critical minerals are not synonymous with rare earths, but they are often confused.

For information on Critical Minerals read here

Uses of Critical Minerals:

Essential for Decarbonization:

India: India is concentrating on securing a consistent supply of critical minerals to achieve its decarbonization and net-zero objectives by 2070. The country plans to establish 500 GW of non-fossil fuel power and greatly expand electric vehicle usage by 2030. Achieving these goals necessitates minerals such as lithium for battery manufacturing. India is investigating joint ventures with Australia to source lithium and cobalt.
For information on steps taken by the government of India for critical minerals read here

What are the issues with Critical Minerals?

Geopolitical Monopoly: A few countries dominate critical mineral resources. For example, Australia controls 55% of lithium reserves, and China has 60% of rare earths.

Processing Dominance by China: China processes a large portion of the world’s critical minerals, such as 35% of nickel and 50-70% of lithium and cobalt.

Environmental and Political Concerns: The energy-intensive and polluting processing of these minerals raises environmental issues. Additionally, China’s dominance leads to political leverage over other countries.

Dependency on Imports: Many countries, including India, heavily rely on imports for these minerals, which poses a risk to their industrial and energy security.

Long Gestation Period for Alternatives: Developing alternative sources and processing capabilities, like India’s plans with Australia, can take over 15 years, delaying self-reliance.

What is the global response to China’s monopoly?

Formation of Minerals Security Partnership (MSP): Led by the US, the MSP includes countries like India, Australia, Canada, Sweden, and Norway to secure mineral supply chains.

Objective of MSP: Aimed at reducing reliance on China by “friend shoring” manufacturing to allied nations.

Diverse Membership: MSP unites countries with rich mineral deposits and those with advanced processing technology, like Japan and South Korea.

Exclusion of Some Key Nations: Notably, mineral-rich countries like Chile and Indonesia are not part of the MSP, raising questions about its effectiveness.

For information on MSP read Article1, Article 2

Question for practice:

Discuss the global response to China’s dominance in critical mineral production and processing.

Include need of critical minerals in India also here, in this section only. [AS1]