The discussion dives into India's urgent mineral dependency on China, spotlighting 30 essential minerals identified for economic and security needs. Delving into recent export controls, the speakers emphasize the strategic risks posed by reliance on a single nation. Challenges in processing domestic lithium deposits are explored, along with suggested reforms for self-sufficiency. Collaborative prospects, particularly with Australia, are outlined as vital for enhancing processing capabilities and securing India's mineral future.
India's dependency on imports for over 10 critical minerals, particularly from China, poses significant risks to its economic stability and security.
To address its mineral processing challenges, India must invest in domestic technologies, diversify supply sources, and forge strategic international partnerships.
Deep dives
The Importance of Critical Minerals
Critical minerals are essential for a nation's economic development and sustainability, playing a key role in clean energy technologies and defense sectors. The classification of these minerals is based on two main parameters: supply risk and economic impact. India's Ministry of Mines identified 30 critical minerals in 2023, influenced by similar assessments from other countries like the EU and the US. This categorization reflects the importance of securing resources vital for achieving India's decarbonization goals and maintaining economic stability.
Challenges in India's Mineral Processing
India faces significant challenges in mineral processing, which hinders its ability to capitalize on its mineral resources effectively. The country is highly dependent on imports for over 10 critical minerals, with substantial reliance on China for essential elements like lithium and silicon. A critical vulnerability arises from India's limited processing capabilities and infrastructural shortcomings, especially for minerals that are deep-seated or found in non-ideal forms. To reduce this dependency, India must develop in-house processing technologies and engage private investment in the mining sector.
Strategic Policy Recommendations
To mitigate import dependence and improve its position in the critical minerals market, India should consider diversifying sources, enhancing recycling capabilities, and fostering international partnerships for processing technology. Initiatives like the Kabil joint venture aim to secure overseas extraction and processing facilities, while recent mineral block auctions signal a step towards domestic resource management. Emphasizing recycling, particularly of lithium for electric vehicle batteries, could dramatically reduce future demand for foreign imports. India needs to prioritize strategic partnerships with countries like Australia for knowledge transfer in processing, thus enhancing its own capabilities and reducing reliance on single suppliers.
To strengthen India’s stance on critical mineral security, the Ministry of Mines in 2023 identified 30 critical minerals deemed essential for the nation's economic development and national security. While the report highlighted India's complete import dependency for ten critical minerals, it did not fully address a more pressing concern - the extent and nature of dependency on China, a strategic adversary with a history of weaponising its mineral dominance.
In this episode, Rakshith and Anushka assess India’s critical mineral dependency on China.
All Things Policy is a daily podcast on public policy brought to you by the Takshashila Institution, Bengaluru.
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