India’s lithium dependency worries

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Context: Lithium has been among the most sought-after mineral during the past few years, largely on the back of its usage in battery manufacturing. China is a major import source of Lithium.

Why is Lithium important for India?

It is a key component of lithium-ion batteries, the demand for which has surged amid the Centre’s push to boost the adoption of electric vehicles (EVs) in the country.

PLI Scheme: The 18,000 crore production-linked incentive scheme for advanced chemistry cell (ACC) battery storage, has kicked off and the supply of lithium, which is largely an imported product, has declined.

Dependency on China: With India being in a diplomatic tussle with China, the supplies from the neighbouring country have declined and India too is looking for other import avenues.

Why the supply of Lithium has declined?

Demand-supply mismatch: The supply of lithium has not kept pace with the rise in demand from electric vehicle makers across the world.

China is witnessing a mismatch between demand and supply, which has led to a rise in prices.

Who are major Lithium producers and does India produce lithium?

Australia was the largest lithium producer in 2021, according to US Geological Survey, with an estimated output of 55,000 metric tonnes.

Chile and China ranked second and third.

India

India is dependent on imports for lithium, as production in the country is minimal.

The first traces of the lithium have been found in Karnataka’s Mandya district, a mere 100 kilometres from Bengaluru. The preliminary find is relatively small, with just about 1,600 tonnes of lithium deposits.

What is India doing to source lithium?

India is searching for domestic reserves and looking for newer countries to source the mineral.

India recently committed to jointly invest $6 million with the Australian government to explore lithium and cobalt mines there over the next six months.

In 2020, KABIL also signed a pact with an Argentine firm to jointly explore lithium in the South American country.

Source: This post is based on the article “India’s lithium dependency worries” published in Livemint on 31st Mar 22.

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