India and US cooperation strengthens energy security and resilience

Source: The post India and US cooperation strengthens energy security and resilience has been created, based on the article “The building blocks of an India-U.S. energy future” published in “The Hindu” on 8 May 2025. India and US cooperation strengthens energy security and resilience.

UPSC Syllabus Topic: GS Paper2- International Relations-Bilateral, regional and global groupings and agreements involving India and/or affecting

Context: India and the U.S. are reviving strategic cooperation in energy, defence, technology, and mobility. Recent statements by U.S. Vice-President J.D. Vance and India’s foreign policy establishment signal a shift toward structured, long-term collaboration.

For detailed information on Trump’s Re-election and India US Relations read this article here

Strengthening India’s Energy Security

1. Three Pillars of Energy Strategy: Stable and affordable resource access, Resilient global supply chains, and A clean energy transition that ensures sustainability and growth.
2. Role of Nuclear and Critical Minerals: Both nuclear energy and critical minerals are essential. They underpin India’s energy transition and industrial resilience, making them central to India-U.S. cooperation.

Securing Critical Mineral Supply Chains

1. Strategic Importance Across Sectors:

• Critical minerals are foundational not just for mining but for clean energy, defence, semiconductors, and electronics. Recognising them as a cross-sectoral strategic asset supports long-term policy and tech collaboration.
• China currently controls around 90% of global rare earth processing capacity and has imposed export restrictions for strategic purposes. This makes global supply chains fragile and reinforces the need for India-U.S. cooperation.

2. Bilateral and Global Diversification Efforts: India and the U.S. signed an MoU in 2024 to secure and diversify supply chains. This includes:

• Forming a consortium for joint exploration and processing,
• Investing in mineral-rich countries in Africa, South America, and Southeast Asia, and
• Promoting demand-led policies through bilateral and plurilateral channels.

3. Infrastructure, Transparency, and Technology: To ensure traceability and real-time collaboration, India and the U.S. should:

• Establish a secure digital Mineral Exchange,
• Develop blockchain-based traceability standards (inspired by the EU Battery Passport), and
• Support sensitive industries like EVs and aerospace with mineral access.

4. Stockpiling and Long-Term Planning:

• Strategic reserves should be jointly built using Indian and U.S. storage facilities. A 20-year roadmap with interim targets must be aligned with India’s Critical Minerals Mission. Support systems like workforce development and data-sharing should be built through iCET.
• India is the first non-G-7 member of the Mineral Security Partnership and will host the upcoming Quad summit, offering a platform to formalise these strategies.

Scaling Nuclear Energy for Future Demands

1. India’s Nuclear Ambition: India aims to reach 100 GW of nuclear power by 2047, up from just 8 GW today. To meet this goal, it must commission 5–6 GW per year from the early 2030s. Some net-zero scenarios suggest the need for over 200 GW by 2070.
2. Policy Reforms to Attract Private Capital: Reforming the Civil Liability for Nuclear Damage Act, 2010 is vital for private entry. India’s modular designs and Holtec’s SMR tech transfer to Indian firms illustrate the potential of international partnerships.
3. Financing and Bankability: Achieving 100 GW by 2047 requires $180 billion. With India’s financial institutions already exposed to $200 billion in the power sector, de-risked models, credible offtake guarantees, and predictable returns are essential.
4. Safety, SMRs, and Industrial Use: SMRs offer flexibility, low land use, and cooling solutions for water-scarce areas. Their use in AI and green steel sectors adds industrial value, but long-term safety requires robust waste and decommissioning strategies from the outset.

Building a Resilient Strategic Partnership

1. Shared Stability in Uncertain Times: The IMF’s April 2025 report shows rising global instability. India’s economic growth and U.S. capital and innovation are naturally aligned to build a stable, future-ready partnership.
2. Reducing the build time of nuclear projects from nine to six years could cut the levelised cost of electricity by 8%, improving financial viability.
3. Institutional Vision Beyond Short-Term Gains: India-U.S. energy cooperation needs enduring institutions, clear policy frameworks, and consistent investment. A resilient energy future will be shaped not by rhetoric, but by execution and shared architecture.

Question for practice:

Evaluate how India-U.S. cooperation in critical minerals and nuclear energy can strengthen India’s long-term energy security and industrial resilience.