India and critical minerals: Strategy, partnerships and challenges

Context

• India’s clean energy transition (EVs, renewables, batteries, grid storage) is highly dependent on imported critical minerals and rare earth elements.

• China’s tightening export controls on critical minerals have intensified supply risks.

• India is pursuing:

  • Diversification of mineral trade linkages

  • Responsible mining and production

  • Standards-based mineral markets

Strategic approach adopted by India

Two-pronged strategy

1. Long-term domestic capability

   • Strengthening mineral policies

   • Responsible mining and ESG compliance

2. Short-term external security

   • Bilateral and multilateral mineral partnerships across continents

Assessment of key partnerships

Australia

• Most reliable strategic partner.

• Advantages:

  • Political stability

  • Large mineral reserves

  • Shared strategic vision

• Under the India–Australia Critical Minerals Investment Partnership (2022):

  • Five target projects identified (lithium, cobalt)

  • Focus on joint research, investments and long-term supply

Japan

• Acts as a model for resilience.

• Lessons from Japan’s response to Chinese rare earth restrictions:

  • Diversification of supply

  • Stockpiling

  • Recycling

  • Sustained R&D

• Cooperation includes:

  • Indian Rare Earths Limited

  • Joint extraction, processing and stockpiling (bilateral and third countries)

Africa

• Offers:

  • Mineral abundance

  • Growing emphasis on local value addition

• Recent engagements:

  • Namibia: lithium, rare earths, uranium

  • Zambia: copper and cobalt asset acquisition talks

• Key challenge:

  • India must adopt a long-term industrial and developmental approach

  • Risk of losing ground to more coordinated competitors

United States

• Cooperation limited despite political intent.

• Constraints:

  • Trade volatility

  • Tariffs on Indian goods

  • Inflation Reduction Act (IRA) incentives disadvantaging partners

• Key initiatives:

  • Transforming the Relationship Utilizing Strategic Technology (TRUST) Initiative

  • Strategic Minerals Recovery Initiative

• The Transforming the Relationship Utilizing Strategic Technology (TRUST) Initiative and the Strategic Minerals Recovery Initiative propose frameworks for joint work on rare-earth processing, battery recycling and clean separation technologies.

• The India-US TRUST (Transforming the Relationship Utilizing Strategic Technology) Initiative is a bilateral program launched in February 2025 to build secure supply chains for critical technologies, with a key component being the Strategic Minerals Recovery Initiative, focused on recovering and processing critical minerals like lithium and rare earth elements (REEs) from industrial waste and mining byproducts to reduce reliance on China and support high-tech industries (AI, quantum, semiconductors)

• Potential strength:

  • Downstream technology and innovation partner

• Limitation:

  • Unpredictability of U.S. trade policy

European Union

• Frameworks:

  • Critical Raw Materials Act

  • European Battery Alliance

  • Circular economy agenda

• Emphasis on:

  • Sustainability

  • Transparency

  • Lifecycle standards

• For India:

  • Alignment with EU norms is essential for deeper integration

European Battery Alliance (EBA)

Launched: October 2017 Initiated by: Vice President Maroš Šefčovič Objective: Build a competitive, sustainable and integrated EU battery value chain Reduce dependence on external suppliers, especially China

European Raw Materials Alliance (ERMA)

Launched: 30 September 2020 by the European Union Purpose: Achieve strategic autonomy in critical raw materials Modelled on: European Battery Alliance Focus minerals: Lithium Rare earth elements Metals used in: Battery magnets Electric and electronic devices Key target: EU to become “almost self-sufficient” in lithium for batteries by 2025

EBA–India Collaboration Framework

Institutional platform

Cooperation primarily under the India–EU Trade and Technology Council (TTC)

Energy storage cooperation

Facilitated under the EU Clean Energy and Climate Partnership (CECP)

West Asia (Gulf region)

• Countries such as UAE and Saudi Arabia:

  • Investing in battery materials, refining, green hydrogen

  • Sovereign wealth funds acquiring mining assets globally

• Potential role for India:

  • Midstream processing hub, not primary extraction

• Limitation:

  • Lack of deep institutional frameworks

Russia

• Strengths:

  • Large reserves of rare earths, cobalt, lithium

  • Long-standing scientific ties

• Constraints:

  • Sanctions

  • Financing and logistics challenges

• Strategic role:

  • Hedge partner, not a core supplier

New frontiers

Latin America

• Countries: Argentina, Chile, Peru, Brazil

• Importance:

  • Copper, nickel, lithium and rare earths

• Indian engagement:

  • Investments by public and private sector

  • Khanij Bidesh India Limited (KABIL) signed a ₹200 crore agreement with Argentina

• Challenge:

  • Intense competition

  • Need for value-chain partnerships, not extraction-only deals

Canada

• Key minerals:

  • Nickel, cobalt, copper, rare earths

• Positive development:

  • Trilateral agreement with India and Australia

• Risk:

  • Political relations will determine reliability

Core lessons emerging

Processing is the real choke point

• Securing ore alone is insufficient.

• Without domestic refining and midstream capacity, India remains vulnerable.

Value-chain based partnerships

• Upstream (extraction): Africa, Australia, Canada, Latin America

• Midstream (processing): Japan, West Asia

• Downstream (technology, recycling): EU, United States

• Diversification hedge: Russia

Domestic reforms are critical

• Strengthening:

  • Responsible mining frameworks

  • Environmental, Social and Governance (ESG) standards

  • Transparency and regulatory certainty

Khanij Bidesh India Limited (KABIL)

Overview

Khanij Bidesh India Limited (KABIL) is a joint venture company of the Government of India. Established to secure critical and strategic mineral assets abroad. Forms a key pillar of India’s resource security and clean energy transition strategy.

Key facts

Founded: 2019 Administrative ministry: Ministry of Mines, Government of India Headquarters: New Delhi

Joint venture partners

National Aluminium Company Limited (NALCO) Hindustan Copper Limited (HCL) Mineral Exploration Corporation Limited (MECL)

Focus minerals

Lithium Cobalt Nickel Rare earth elements (These minerals are critical for EV batteries, renewable energy systems, electronics, and defence applications.)

Core functions

Overseas: Exploration Acquisition Development of mineral assets Securing long-term supply chains for India’s: Clean energy transition Electric mobility Strategic industries

Conclusion

• India has created an extensive web of critical mineral partnerships.

• The next phase requires:

  • Deepening effective partnerships

  • Recalibrating weak engagements

  • Prioritising processing, technology and long-term certainty

• Strategic minerals policy will be decisive for India’s clean energy and industrial future.

Prelims Practice MCQs

Q. Consider the following statements about Khanij Bidesh India Limited:

1. It is a Navratna Public Sector Undertaking under the Ministry of Mines.

2. It was established to secure critical and strategic mineral assets abroad.

3. It focuses on minerals essential for electric mobility and clean energy transition.

Which of the statements given above are correct?

(a) 1 and 2 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3

Answer: (b)

Explanation:

• KABIL is not a PSU but a joint venture company → Statement 1 incorrect.

• It was created to secure overseas critical minerals → Statement 2 correct.

• Its focus aligns with EVs and clean energy → Statement 3 correct.

Q. Khanij Bidesh India Limited (KABIL) is a joint venture of which of the following entities?

1. National Aluminium Company Limited

2. Hindustan Copper Limited

3. Mineral Exploration Corporation Limited

4. Indian Rare Earths Limited

Select the correct answer using the code below:

(a) 1, 2 and 3 only
(b) 1, 3 and 4 only
(c) 2 and 4 only
(d) 1, 2, 3 and 4

Answer: (a)

Explanation:

• JV partners: NALCO, HCL, MECL.

• Indian Rare Earths Limited is not a partner.