Exploration, imports, private firms: India’s search for lithium spreads out

Source: The post is based on an article “Exploration, imports, private firms: India’s search for lithium spreads out” published in the Business Standard on 23rd July 2022.

Syllabus: GS 1 Distribution of key mineral resources; and GS 3 Science and Technology- Developments and their Applications and Effects in Everyday Life; Achievements of Indians in Science & Technology; Indigenization of Technology and Developing New Technology.

Relevance: Li-Batteries Technology’ Lithium Minerals; EV Technology etc.

News: Recently, the Centre has listed a bill in the parliament related to mining sector reforms. It is expected to allow private companies to dig for lithium.

Lithium called as “white gold” is an essential component in electric car batteries and 74% of overall global production is used in battery production.

Across the world, there is a rush to find Lithium. Therefore, the Indian government is also promoting the same.

Estimate of Lithium Resources

Global

According to the US Geological Survey, a total of about 89 million tonnes (mt) of lithium reserve is available worldwide. The top countries with resources are Bolivia (21 mt), Argentina (19 mt), Chile (9.8 mt), US (9.1 mt), Australia (7.3 mt), and China (5.1mt).

Lithium reserves in India

According to government data, no reserves or resources of lithium-bearing metals are so far part of the national-mineral inventory.

Measures Taken for exploration of Lithium reserves in India

The Geological Survey of India (GSI) has carried out 14 projects on lithium and associated elements in Bihar, Chhattisgarh, Himachal Pradesh, Jammu & Kashmir, Jharkhand, Madhya Pradesh, Meghalaya, Karnataka, and Rajasthan during the field season programme (FSP) 2016-2017 to 2020-2021.

The GSI has also carried out 5 projects in Arunachal Pradesh, Andhra Pradesh, Chhattisgarh, Jammu & Kashmir, and Rajasthan during FSP 2021-22.

The Atomic Minerals Directorate for Exploration and Research (AMDER) has carried out preliminary surveys and limited subsurface exploration projects in Marlagalla in Mandya district of Karnataka. The surveys have shown the first traces of lithium resources of 1,600 tonnes in the country. But the reserves found are classified in the “inferred category”. Therefore, the associated confidence level is low.

Other measures taken by the government to solve India’s Lithium problem

Australia is the largest country in terms of production. Therefore, India and Australia agreed to undertake due diligence on greenfield and brownfield lithium and cobalt mineral assets, looking at India’s long-term clean energy roadmap.

Australia had signed a deal to supply India with critical minerals needed for the new-energy economy.

Further, Indian companies are also tying up with suppliers in countries that have major resources.

India has planned to set up a Giga factory for lithium-ion cell manufacturing in India by 2024. The Li-mineral will be sourced from mines in South America, Africa, and Australia.

Further, in addition to the above, a number of companies have signed MOUs to set lithium-ion up battery plants and cell technology in India, in the last 3-4 years.

The PLI scheme ‘National Programme on Advanced Chemistry Cell (ACC) Battery Storage’ is also aimed at reducing imports by building a manufacturing capacity of 50-gigawatt hour (GWh).

India’s Import of Lithium

India’s EV Sector is dependent on imports. Lithium is primarily imported in the form of lithium-ion batteries for EVs and energy storage systems (ESS).

India’s imports of lithium and lithium-ion in FY21 stood at Rs 8,984 crore in FY21 and increased to Rs 13,838.22 crore in FY22.

Source Countries: China and Hong Kong are the major sources from where India imports.

What are the challenges?

Globally, the demand for Li-battery has surged, Therefore, the prices of lithium carbonate, used in rechargeable lithium batteries, have also surged a lot. For example, in the last year, prices of Chinese lithium carbonate increased by more than 400 percent as demand outstripped supply.

There is a plan for 30% EV sales penetration by 2030. Therefore, the demand for lithium is expected to surge. And it is going to be dependent on Lithium imports.