**New Delhi**: The Indian government initiates a ₹34,300 crore mission to bolster domestic capabilities in critical minerals, addressing supply chain vulnerabilities crucial for renewable technologies. This initiative seeks to reduce reliance on imports and promote sustainable practices in line with the country’s net-zero ambitions by 2070.
The global transition to clean energy is driving a significant increase in the competition for critical minerals and materials vital for the development of renewable technologies. This competition is especially pronounced in India, where the growing economy is aiming for a net-zero emissions target by 2070. The country is heavily reliant on imports for essential critical minerals and materials needed in the manufacturing of these technologies.
In response to potential vulnerabilities in the supply chain, the Indian government launched the National Critical Mineral Mission in January 2023. This initiative comes with a budget of ₹34,300 crore (approximately US$4 billion) over a span of seven years and aims to bolster domestic capabilities across all stages, from exploration and mining to processing and recovery of critical minerals. Key strategies outlined in the mission involve fast-tracking approvals for mining projects, encouraging international acquisitions, stockpiling reserves, establishing processing parks, promoting recycling, and creating a Centre of Excellence for research and development.
The supply chain for critical minerals has been identified as particularly fragile, with production concentrated in just a few countries. Notably, China holds a staggering 60 percent of global production of rare earth elements and is the preeminent refiner of lithium, cobalt, and graphite— minerals integral to battery technologies. Without a steady supply of these resources, India risks encountering supply chain bottlenecks that could hinder its push towards energy security and industrial competitiveness. Recognising this potential impediment, the Indian government has prioritised the exploration and extraction of 30 minerals deemed critical to its future.
In tandem with this initiative, the Geological Survey of India is expanding its exploration activities. To date, it has completed 368 projects and has 195 ongoing and an additional 227 planned. An important step in securing essential resources occurred in January when Khanij Bidesh India Limited secured 15,703 hectares in Argentina for lithium mining, ensuring long-term access to this indispensable resource.
To support its critical mineral ambitions, the Indian government is also facilitating funding for start-ups and micro, small, and medium enterprises focused on this sector. This effort is aimed at developing a stable and sustainable supply chain that lessens the country’s reliance on foreign suppliers.
The Ashoka Centre for a People-Centric Energy Transition (ACPET) has conducted an extensive analysis projecting the cumulative mineral requirements for India until 2070, with significant benchmarks set for 2030 and 2047. This projection encompasses four key renewable energy sectors: solar photovoltaic (PV), concentrated solar power (CSP), onshore and offshore wind energy, and battery energy storage systems (BESS) specifically for solar PV, as well as electrolysers for green hydrogen production.
The minerals identified as critical for solar PV technologies include copper, silicon, and lithium, among others. For CSP technologies, essential components include copper and titanium. Wind energy technologies underscore the importance of minerals such as neodymium and dysprosium, while battery systems have been analysed in relation to various chemistries like lithium-ion systems and vanadium redox flow batteries, revealing a wide array of critical minerals involved in their production.
Along these lines, for electrolysis technologies necessary for hydrogen production, crucial minerals include nickel and cobalt, signifying the extensive interdependency of these minerals with the clean energy landscape. The ACPET analysis identifies 22 of the 30 minerals flagged by the Ministry of Mines as vital, underscoring the importance for India to secure these supplies as part of its renewable energy agenda.
The Centre for Social and Economic Progress has also contributed by developing a framework that assesses mineral security, evaluating economic importance and supply risks associated with critical minerals. This assessment indicates a direct correlation between high economic value and significant supply chain challenges, notably regarding minerals such as copper, nickel, and lithium, which are increasingly in demand yet face vulnerabilities.
As India aims for self-sufficiency in its mineral supply, the country is recognising the necessity of establishing strategic global partnerships. With China dominating the critical minerals market, alternatives such as the Commonwealth of Independent States (CIS) are being considered for collaboration in exploration and extraction.
Logistical challenges and geopolitical considerations will require careful management, yet the prioritisation of long-term offtake agreements with resource-rich countries will be essential. Initiatives like the India-US TRUST (Transforming the Relationship Utilizing Strategic Technology) and the Mineral Security Partnership are fostering collaboration to build resilient supply chains.
India’s focus on investing in indigenous refining capacities could reduce dependency on foreign processing, thereby adding value domestically. Furthermore, adopting circular economy principles by enhancing recycling technologies is viewed as crucial for minimising reliance on virgin mineral extraction.
The convergence of these strategies aims to position India as a competitive player in the critical mineral supply chain and address the multifaceted challenges associated with the transition to a clean energy future.
Source: Noah Wire Services
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