**New Delhi**: The Indian government acquires a 9,000-square-kilometre copper and cobalt exploration block in Zambia amid declining domestic production, aiming to secure essential mineral supplies as global demand intensifies for electric vehicle and clean energy technologies.
On February 27, the Indian government announced the acquisition of a significant 9,000-square-kilometre exploration block for copper and cobalt in Zambia, a region renowned for its high-grade mineral deposits. This move comes against a backdrop of declining domestic production in Indian mines and is seen as a crucial step for India in establishing overseas mining operations. Domestic copper ore production for the fiscal year 2023-24 is projected at 3.78 million tonnes, an 8% decrease from figures recorded in 2018-19.
The country’s sole domestic copper miner, Hindustan Copper Ltd (HCL), reported a 6% year-on-year reduction in ore production between April and January of the current financial year. As a direct consequence of stagnant domestic production, India has witnessed a doubling in value terms of its copper concentrate imports, which have surged to Rs 26,000 crore since 2018-19. This situation has prompted India to explore international mining ventures, particularly in copper-rich countries like Zambia, Chile, and the Democratic Republic of Congo (DRC), where mineral deposits are typically of higher grade and less time-intensive to operationalise.
India’s interest in these international assets aligns with a broader trend highlighted by a report from the International Energy Agency (IEA), which noted that Africa’s share in the production of critical minerals like copper is increasing. According to the IEA, Africa accounts for 70% of global cobalt production and 16% of global copper production, with the DRC expected to become the world’s second-largest copper supplier by 2030.
In Zambia, which ranks as the seventh largest copper producer globally, the Geological Survey of India (GSI) will lead the exploration efforts on the newly secured block, which is approximately six times the size of Delhi. Notably, mining interests such as the Vedanta Group already have significant holdings in Zambia’s neighbouring Copperbelt province. The country’s mining landscape includes prominent operators such as Canada-based First Quantum Minerals and China’s state-owned Nonferrous Metal Mining.
The urgency of securing copper supplies is echoed in the current market dynamics, notably marked by a warning from the White House on February 25 regarding the “threat to national security from imports of copper”. The fact sheet issued by the White House asserted that reliance on foreign copper poses risks to U.S. defence capabilities and technological innovation. The document detailed the importance of copper in diverse applications, with specific emphasis on its critical role in defence and emerging technologies including electric vehicles and advanced electronics.
Additionally, the economic implications of copper production have prompted the United States to initiate an investigation into how copper imports could affect national security and the domestic economy. This move reflects a growing recognition of the geopolitical stakes involved in securing supply chains for essential commodities.
Meanwhile, Bloomberg reported on February 17 that tightening supplies of copper ore have led China to impose restrictions on the overcapacity of its smelting operations. Companies in China aspiring to establish new smelters must secure long-term contracts with copper mines, predominantly located in the DRC, Chile, and Peru. With China controlling half of the global smelting and refining capacity, it remains a key player in the international copper market.
As countries like India, China, and the U.S. scramble to secure robust supply chains for copper, the competitive landscape is likely to become increasingly pronounced. The race is compounded by projections indicating that worldwide demand for copper, driven chiefly by electric vehicle batteries and clean energy technologies, is expected to outstrip supply from mines by 2035. As a result, both mining and recycling will be pivotal in addressing the anticipated shortfall in the coming decade.
Source: Noah Wire Services
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