Context

• Three years ago, at the start of India’s G20 presidency, critical minerals were not central to strategic policy.
• Minerals such as lithium remained classified as atomic minerals, restricting private participation.
• Recent policy reforms and the Union Budget mark a decisive transformation: critical minerals are now integral to India’s industrial strategy, energy transition, and geopolitical positioning.
• The national focus has shifted from policy formulation to large-scale execution, emphasising speed, depth, and technological capability. 

The Policy Shift: From Peripheral Concern to Strategic Priority

• Emergence of a Comprehensive Framework
  • India has established a structured framework to strengthen mineral security.
  • A list of 30 critical minerals has been identified, royalty rates rationalised, and private exploration liberalised.
  • In January 2025, the government launched the National Critical Mineral Mission (NCMM) with a ₹16,300 crore outlay, signalling long-term commitment.
  • This framework places India among countries pursuing resource resilience through coordinated planning and investment.
• The Execution Challenge
  • Despite policy clarity, execution remains complex. Mineral discovery and development require sustained capital and long gestation periods.
  • More critically, global processing capacity is highly concentrated, with China controlling up to 90% for several key minerals.
  • This dominance creates vulnerabilities in global supply chains.
  • Therefore, India’s strategy must extend beyond mining to strengthening domestic refining, value addition, and downstream integration.

India’s Existing Capabilities and Industrial Potential

• According to the Council on Energy, Environment and Water, domestic industries already produce high-purity copper, graphite, rare earth oxides, tin, and titanium, often exceeding 99.9% purity.
• These capabilities demonstrate technical competence in high-purity processing.
• However, production volumes remain limited and largely oriented toward conventional industries.
• Meeting the demands of clean technologies, defence manufacturing, and advanced electronics requires technological upgrading, capacity expansion, and deeper refining.
• Established strengths in chemicals, pharmaceuticals, and textiles provide transferable skills for scaling complex mineral processing.

Priority Areas for Effective Implementation

• Creating Domestic Demand for Processed Minerals
  • Budget 2026 advances implementation by removing import duties on capital goods used in mineral processing, easing the burden of high capex investements.
  • Yet investor confidence depends primarily on assured domestic demand.
  • Government initiatives promoting electric vehicles, batteries, solar modules, and wind turbines create an opportunity for backward integration, but delays increase uncertainty for midstream processors.
  • Expanding the deployment of domestically manufactured clean technologies would stimulate demand for processed minerals, strengthen upstream mining, and deepen industrial ecosystems.
• Adopting an AI-First Approach to Exploration
  • The NCMM targets 1,200 exploration projects by FY2031, supported by tax deductions for exploration expenditure on nine critical minerals, including previously restricted elements such as beryllium, tantalum, lithium, and niobium.
  • Exploration, however, remains inherently risky and capital-intensive.
  • An AI-first approach can significantly enhance prospectivity analysis and reduce uncertainty.
  • Aligning the IndiaAI Mission, the National Geospatial Policy, and Mission Anveshan can strengthen the use of geospatial analytics and seismic AI tools.
• Leveraging Geopolitical Disruption for Technological Sovereignty
  • The weaponisation of rare earth magnets and battery supply chains in 2025 exposed systemic fragility in global industrial networks.
  • India’s initiatives, including rare earth corridors and reduced import duties on monazite sands, reflect efforts to build technological sovereignty.
  • To succeed, states must utilise existing infrastructure and skilled manpower to serve global markets, generate employment, and strengthen regional economies.

The Importance of International Partnerships

• Domestic reforms must be complemented by strategic global engagement.
• India should deepen partnerships with technologically advanced countries such as Australia, Japan, the United Kingdom, the United States, and European nations.
• These countries possess advanced mineral processing and component manufacturing expertise.
• Encouraging firms from these regions to establish operations in India will require regulatory certainty, strong legal safeguards, research collaboration, and predictable market access.
• Institutional mechanisms such as the India-European Union Free Trade Agreement provide a framework for structured cooperation.
• Financial incentives, including the ₹7,280 crore scheme for rare earth permanent magnets, must be supported by long-term stability and transparent governance to foster durable international collaboration.

Conclusion

• India’s repositioning of critical minerals marks a structural shift in its development strategy.
• By prioritising mineral security, expanding domestic processing, encouraging demand creation, adopting AI-driven exploration, and strengthening global partnerships, India aims to build a resilient and integrated ecosystem.
• Sustained inter-ministerial coordination, proactive state leadership, and technological advancement will determine success.
• In a volatile global environment, leadership in critical minerals will depend not only on resource availability but on coherent execution, innovation, and strategic foresight.