What’s in Today’s Article?

• Overview (Context of the Article)
• About Critical Minerals (Meaning, China’s Dominance, Export Strategy, India’s Dependency on China, etc.)
• Way Forward

Overview:

• In 2023, the Ministry of Mines identified 30 critical minerals essential for India's economic development and national security.
• The report highlighted a complete import dependency for 10 critical minerals but fell short of addressing India's reliance on China—a dominant player in the global critical minerals ecosystem.
• This reliance raises strategic vulnerabilities and the need for alternative strategies.

What are Critical Minerals?

• Critical minerals are raw materials essential for economic and national security, often used in high-tech industries and renewable energy technologies.
• They are typically rare, difficult to mine and substitute, and often vulnerable to supply chain disruptions due to limited global production and geopolitical factors.
• The growing demand for these minerals, driven by technological advancements and the global transition to green energy, underscores their critical importance.
• Securing a stable supply of critical minerals is thus a strategic priority for many countries to ensure economic stability and technological progress.

China’s Dominance in Critical Minerals:

• Vast Resources: China has discovered 173 types of minerals, including:
  • 13 energy minerals
  • 59 metallic minerals
  • 95 non-metallic minerals
• Strategic Investments: With $19.4 billion invested in exploration in 2023, China discovered 132 new mineral deposits, including 34 large ones.
• Processing Capabilities: Dominates processing and refining:
  • Rare earths: 87%
  • Lithium: 58%
  • Silicon: 68%
• Global Investments: Strategic stakes in overseas mining projects amplify its control over supply chains.

China's Export Strategy:

• China strategically controls critical mineral exports, particularly targeting those crucial for semiconductors, batteries, and high-tech manufacturing. Key examples include:
  • 2010 Rare Earth Embargo: Against Japan
  • Restrictions on Gallium, Germanium, and Antimony: Recent targeted actions
  • Ban on Rare Earth Technologies (2023): To protect domestic interests
• China avoids actions that might:
  • Disrupt its export-dependent industries
  • Undermine its reliance on Western-imported raw materials

India's Dependency on China:

• India’s import data (2019-2024) reveals high dependency on Chinese supplies for six critical minerals:
  • Bismuth (85.6%): Vital for pharmaceuticals and chemicals
  • Lithium (82%): Core to EV batteries and energy storage
  • Silicon (76%): Crucial for semiconductors and solar panels
  • Titanium (50.6%): Key for aerospace and defense
  • Tellurium (48.8%): Used in solar and thermoelectric devices
  • Graphite (42.4%): Indispensable for EV batteries and steel production
• China's dominant global production shares in these minerals underscore India's supply chain vulnerabilities.

Why India Relies on Imports?

• Despite abundant mineral resources, structural challenges hinder India’s mining and processing ecosystem:
  • Technological Barriers:
    • Limited ability to extract minerals like lithium from clay deposits in Jammu & Kashmir, despite having 5.9 million tonnes of resources.
  • Investment Gaps:
    • High-risk investments in exploration deter private sector participation.
  • Policy Shortcomings:
    • Lack of incentives and advanced mining technologies limit domestic production capabilities.

Strategic Way Forward:

• Securing Overseas Assets:
  • The government established KABIL (Khanij Bidesh India Limited) to acquire overseas mineral resources.
• International Collaborations:
  • Partnerships through the Minerals Security Partnership and Critical Raw Materials Club aim to diversify supply sources.
• Research and Development:
  • Institutions like the Geological Survey of India and CSIR are advancing technologies for exploration and processing.
• Promoting Recycling:
  • Circular economy initiatives and production-linked incentives focus on recycling critical minerals to reduce dependency.
• Policy Reforms:
  • Introducing incentives to attract private investment and updating mining regulations to encourage domestic exploration.

Conclusion:

• India’s transition from dependence on China requires sustained investment, technological advancements, and global partnerships.
• While government initiatives show promise, long-term commitment and proactive policies will be critical for securing a self-reliant future in critical minerals.