31 December 2021

Critical Minerals for India: Assessing their Criticality and Projecting their Needs for Green Technologies

Rajesh Chadha & Ganesh Sivamani

Executive Summary

This working paper assesses the level of criticality of 23 select minerals for India’s manufacturing sector. Various indicators quantify the criticality along the dimensions of economic importance and supply risk. The paper projects India’s mineral needs for green technologies, including renewable electricity generation and electric vehicle manufacturing, in line with the country’s various climate change mitigation objectives over the next two decades.

Lithium, strontium, and niobium have relatively high economic importance, and heavy rare earth elements, niobium, and silicon have relatively high supply risks. The results of this projection exercise indicate that India is not equipped to meet its green technology requirements through domestic mining alone. Imports of minerals for domestic manufacturing or imports of the final product (embedded in these minerals) will be needed to meet its policy agenda on climate change mitigation.

While India would need to rely on imports for these technologies over the next two decades, further work must be done to better utilise the available minerals within the country for its longer-term needs. Newly installed renewable capacity today will require replacement after two to three decades. India can be better prepared for the next stage of green technology utilisation by laying the groundwork for exploring and mining. The country has resources of nickel, cobalt, molybdenum, and heavy rare earth elements, but further exploration would be needed to evaluate the quantities of their reserves. Part 1 of this study shows that this is particularly important for heavy rare earths and cobalt due to their high supply risks. While nickel currently has a lower supply risk than the other minerals in this study, it has high economic importance, and an assured domestic source would help lower the supply risk.

There are some minerals where India has no known resources, such as lithium and indium, and here the country must focus on securing supply chains for these minerals and acquiring foreign mineral assets to ensure their continuous supply.

The study results point to policy recommendations for ensuring uninterrupted supplies of critical minerals through enhanced domestic mineral exploration and extraction, along with assured sources elsewhere. The import risks of critical minerals may be reduced by developing resilient supply chains, signing trade agreements, and acquiring mining assets abroad. In addition, government-to-government engagement efforts through KABIL need to be supplemented with the acquisition of private mines.

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