Strategy to secure critical minerals

Source: The post “Strategy to secure critical minerals” has been created, based on “Strategy to secure critical minerals” published in “BusinessLine” on  06th March 2026.

UPSC Syllabus: GS Paper-3-Science and technology

Context: Critical minerals such as Lithium, Cobalt, Copper and Rare Earth Elements are essential for clean energy technologies, artificial intelligence infrastructure, advanced electronics, and defence systems. The rapid expansion of the green transition and AI-driven industries has significantly increased the global demand for these minerals. However, the supply chains are concentrated in a few countries, especially China, which creates strategic vulnerabilities for India.

Importance of Securing Critical Minerals for India

1. Critical minerals are essential for manufacturing renewable energy technologies such as solar panels, wind turbines, and electric vehicle batteries.
2. Securing these minerals is necessary for achieving India’s climate commitments and net-zero emission targets.
3. Critical minerals are widely used in artificial intelligence hardware, semiconductors, and advanced electronic devices, which are vital for technological advancement.
4. Many defence technologies such as missiles, radar systems, and advanced aerospace equipment depend on these minerals, making them crucial for national security.
5. A secure supply of critical minerals can support India’s industrial growth, manufacturing competitiveness, and economic development.

Government Initiatives

1. The National Critical Mineral Mission aims to strengthen exploration, mining, and processing of critical minerals with an outlay of ₹34,000 crore over seven years.
2. The government has proposed the development of rare earth corridors to create integrated mining-to-processing value chains.
3. The Union Budget has provided exemption from Basic Customs Duty on capital goods used for processing critical minerals to encourage investment.
4. India is also securing overseas mineral assets through Khanij Bidesh India Limited partnerships with countries such as Australia, Argentina, and Chile.

Challenges in India’s Critical Mineral Sector

1. The global supply of critical minerals is highly concentrated in a few countries, particularly China, which dominates mining and refining activities.
2. India currently lacks large-scale commercially viable refining and downstream processing facilities for critical minerals.
3. Exploration, mining, and refining projects require large capital investments and have long gestation periods.
4. Global prices and demand for critical minerals are highly volatile, which discourages private sector investments.
5. Mining activities often lead to environmental degradation and social conflicts with local communities.

Strategies to Strengthen India’s Critical Mineral Supply Chain

1. The government should invest in developing domestic mining and refining infrastructure to create a complete value chain within the country.
2. Policy incentives such as concessional loans, production tax credits, and financial support for refinery construction should be provided to attract private sector investment.
3. The government can introduce revenue stabilization mechanisms such as contracts for difference and demand guarantees to reduce investment risks.
4. Artificial intelligence-based geological exploration should be promoted to improve mineral discovery rates and reduce exploration costs.
5. India should strengthen international partnerships and acquire mineral assets abroad to diversify supply sources.
6. Local communities should be encouraged to participate as stakeholders or co-investors in mining projects to ensure social acceptance.
7. Strong environmental and social safeguards should be implemented to ensure sustainable and responsible mining practices.

Conclusion: Securing critical minerals is essential for India’s green transition, technological advancement, and strategic autonomy. A coordinated approach involving government support, private sector participation, technological innovation, and international cooperation will be crucial for building a resilient and sustainable critical mineral supply chain.

Question: Discuss the importance of securing critical minerals for India and suggest strategies to strengthen India’s critical mineral supply chain.

Source: BusinessLine