Minerals Security Finance Network (MSFN)

Source – This post on Mineral Security Finance Network (MSFN)  is based on the article “India joins US-led Mineral Security Network to secure critical minerals, fend off Chinese challenge” published in Indian Express on 26th September 2024.

Why in News?

India has joined the US-led initiative Minerals Security Finance Network (MSFN). It aimed at securing supply chains for critical minerals. The announcement was made during the United Nations General Assembly on September 23, 2024.

About Minerals Security Finance Network (MSFN)

1. About: MSFN stems from the Minerals Security Partnership (MSP) established by the US in 2022. India was inducted into MSP in June 2023.

2. Aim: MSFN aims to reduce the global reliance on countries like China, particularly for rare earth minerals, which are critical for various technologies.

3. Objective: The initiative seeks collaboration between Development Finance Institutions (DFIs) and Export Credit Agencies (ECAs) from participating nations, alongside the private sector, to create synergies and increase production capacity for critical minerals.

4. Focus: MSP is primarily focused on minerals like cobalt, nickel, lithium, and the 17 rare earth elements (REs), essential for electric vehicle batteries and high-end electronics.

The global demand for critical minerals is increasing due to the clean energy transition. MSFN focuses on ensuring resilient supply chains for these minerals.

5. China holds a dominant position in the rare earth minerals market, particularly in heavy rare earth elements (HREEs) like dysprosium and terbium. Currently, India relies heavily on imports of these elements from China.

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