Tapping into Kazakhstan’s Rare Earths Potential 

Source: This post on Tapping into Kazakhstan’s Rare Earths Potential has been created based on article “Tapping into Kazakhstan’s rare earths potential” published in The Hindu on 27th December 2024.  

UPSC Syllabus topics: GS Paper 1- Distribution of Key Natural Resources across the world   

Context: The article delves into the growing importance of rare earth elements in the global transition to cleaner energy and highlights India’s need to diversify its sources of rare earths to reduce dependence on China.

Why are rare earths critical, and what challenges does India face in sourcing them? 

1. Rare earths are essential for clean energy technologies and advanced industries like electronics, defense, and renewable energy.  
2. As the third-largest carbon emitter, India is transitioning to renewable energy and has a growing need for rare earths.  
3. Despite being the fifth-largest holder of these elements, India depends heavily on imports from China (60%) due to its lack of advanced extraction technologies.  
4. This reliance on China is concerning because of China’s dominance in the sector, accounting for 70% of global production and a history of supply disruptions tied to geopolitical tensions. 

How has China’s dominance and the Russia-Ukraine war impacted rare earth supply chains? 

1. China’s monopoly, holding over one-third of global reserves, allows it to influence supply chains.  
2. Its recent halt in antimony exports and ban on critical extraction technologies further tighten its control.  
3. The Russia-Ukraine war exacerbated supply chain risks, as Russia’s reduced ore exports added pressure to already concentrated global rare earth sources.  
4. These factors have driven India and Western nations to diversify supply chains and reduce dependency on China. 

Why is Kazakhstan an attractive partner for India in rare earth sourcing? 

1. Kazakhstan, rich in rare earth resources and holding 15 of the 17 known rare earth elements, offers a strategic alternative to China.  
2. The country has advanced extraction technologies and existing agreements with Japan, Germany, and others, which underline its credibility in the sector. Kazakhstan’s vast reserves, including dysprosium, beryllium, tantalum, and niobium, align with India’s renewable energy goals and strategic needs. 
3. Additionally, connectivity initiatives like the International North-South Transport Corridor strengthen India’s engagement with Kazakhstan. 

What role do rare earths play in Kazakhstan’s economy? 

1. Kazakhstan is positioning rare earths as the “new oil” for its economy.  
2. The country hosts unique full-cycle facilities for beryllium and scandium and is a global leader in manufacturing tantalum and niobium.  
3. It is also expanding investments in tungsten, battery materials, and magnets, with significant growth projected in dysprosium extraction between 2024 and 2029. 
4. These resources are vital for clean energy, telecommunications, and nuclear technologies. 

How can India and Kazakhstan address challenges in collaboration? 

While a partnership promises mutual benefits, challenges include: 

i) Connectivity Issues: Geographic hurdles between the two nations. 

ii) Technological Gaps: Both countries lack advanced extraction capabilities. 

To address these issues, the proposed India-Central Asia Rare Earths Forum aims to: 

1. Facilitate joint mining ventures and bilateral training. 
2. Share geological data and expertise. 
3. Foster private sector investment. 
4. Encourage sustainable extraction practices. 
5. Create a regional market to reduce dependence on China. 

How does this partnership align with India’s renewable energy goals? 

1. India’s COP29 pledge to achieve 500 GW of renewable energy by 2030 underscores the need for critical rare earth elements like dysprosium.  
2. Collaborating with Kazakhstan can enhance India’s resource security, reduce its dependence on China, and support its clean energy ambitions while ensuring supply chain diversification.