India aims to secure critical minerals for future growth

Source: The post India aims to secure critical minerals for future growth has been created, based on the article “Critical minerals:India must step up its strategies” published in “Businessline” on 24 April 2025.

UPSC Syllabus Topic: GS Paper3-Infrastructures

Context: India’s goal to lead in clean energy and digital technology depends on securing access to critical minerals like lithium, cobalt, and nickel. Rising global demand and fragile supply chains have triggered a need for India to reshape its mineral strategy and industrial policy.

For detailed information on India launches mission to secure critical minerals read this article here

Global Scramble for Critical Minerals

1. Rising Demand and Import Dependency: As nations shift to clean energy, demand for critical minerals has surged. India faces high vulnerability as it relies 100% on imports for lithium, cobalt, and nickel—essential for batteries and electronics.
2. Untapped Domestic Reserves: India holds significant reserves of cobalt ore (44.9 million tonnes), copper (163.9 million tonnes), graphite (211.6 million tonnes), and nickel (189 million tonnes). However, these remain underutilised due to weak domestic refining capacity.

The Geopolitical Landscape

1. China’s Strategic Dominance: China controls the processing and export of rare earths like samarium, gadolinium, and dysprosium—key to defence and green technologies. Its recent export restrictions highlight supply chain risks amid U.S.-China tensions.
2. Global Diversification Moves: The U.S. is set to increase tariffs on Chinese lithium-ion batteries from 7.5% to 25% by January 2026. This is pushing countries to seek alternatives to Chinese supplies, giving India a potential opening.
3. The European Union’s Strategic Push: The EU has launched a €12 billion Global Gateway package to strengthen ties with Central Asia. The goal is to create alternate mineral, energy, digital, and transport routes.
4. International Competitors Emerge: Ukraine is offering its mineral reserves to attract U.S. investment. Pakistan is also being considered for strategic mining partnerships. Even the UK is reviewing its mineral policies to fix supply risks.

India’s Diplomatic and Strategic Efforts

1. Bilateral Engagements and Partnerships: India is building ties with resource-rich countries like Chile, which has the world’s largest lithium reserves. State firms like Coal India are exploring investments in lithium and copper assets abroad.
2. Multilateral Collaborations: India has signed MoUs with Australia, Argentina, and the Democratic Republic of Congo. It also works with the U.S. under the Critical Minerals Dialogue to co-invest in mining and refining infrastructure.

Challenges in Domestic Capabilities

1. Refining and Processing Gaps: Despite having reserves, India lacks the facilities to refine battery-grade cobalt. Copper and graphite also face import dependence due to low domestic processing capacity.
2. Policy Interventions: India’s ₹16,300 crore National Critical Mineral Mission aims to boost exploration and global acquisition. Changes in mining laws and removal of customs duties are intended to ease processes and attract investment.

Long-Term Strategies for Mineral Security

1. Enhance Exploration and Green Mining: India must expand geological surveys, support private investment, and ensure environmental safeguards to reduce import dependence.
2. Incentivize the Full Value Chain: PLI schemes should extend across exploration, refining, and manufacturing to build a robust supply chain.
3. Boost Global Technology Partnerships: Ties with Japan, Belgium, and South Korea can improve domestic refining through joint ventures and tech sharing.
4. Strengthen Diplomatic Supply Chains: India should broaden bilateral agreements and leverage platforms like QUAD and the Minerals Security Partnership for secure sourcing.
5. Build a Circular Economy: Investing in recycling and stockpiling critical minerals will cut reliance on imports and shield India from global shocks.

Conclusion

India’s clean energy and tech future depends on securing stable, diverse, and sustainable mineral access. A strategic approach across diplomacy, industry, and innovation is essential.

Question for practice:

Discuss how India is reshaping its critical mineral strategy to support clean energy and digital technology goals.