Dalvoy Logo
Dalvoy
UPSC MainsGeneral Studies Paper IGeographyPractice question

Critical Minerals Distribution and Implications for India

Critical minerals have emerged as strategic assets in the global energy transition. Examine their geographical distribution and implications for India.

Examine~250 words3 min readmedium
Attempt it first, timed · optional

Write the answer on paper, as in the exam. Start the timer, keep to the word target.

00:00/ 11 min · 250 words

Done writing? Photograph the sheet and see how it scores against this model answer, with feedback on what to fix.

Upload your answer sheet

How to approach

Begin by defining critical minerals and highlighting their indispensability to the global clean energy transition. Analyse the geographical concentration and supply chain vulnerabilities associated with their mining and refining, and examine the economic, strategic, and energy-security implications for India along with its key policy initiatives. Conclude by underscoring the need to bridge the domestic midstream processing gap and promote circular economy practices.

Model answer

469 words

Introduction

Critical minerals, including lithium, cobalt, nickel, and rare earth elements (REEs), form the foundational bedrock of the global transition from fossil fuels to renewable energy and high-technology manufacturing. In 2023, India officially designated 30 minerals as critical to its economic development and national security. The strategic vulnerability of these resources arises not only from soaring industrial demand but from extreme geographical concentration in both extraction and refining.

Geographical Distribution and Supply Chain Concentration

Unlike fossil fuels, critical minerals suffer from high geographic concentration across mining, with midstream processing even more heavily monopolised:

  • Lithium: The 'Lithium Triangle' encompassing Chile, Argentina, and Bolivia contains over half of the world's proven reserves, while Australia remains the leading hard-rock extractor.
  • Cobalt: The Democratic Republic of Congo (DRC) accounts for over 70% of global cobalt extraction, frequently vulnerable to political instability and supply disruptions.
  • Natural Graphite: Mined predominantly in China, Mozambique, and Madagascar, with China maintaining commanding leverage over synthetic and processed anode-grade graphite.
  • Rare Earth Elements (REEs): Indispensable for permanent magnets in wind turbines and electric vehicle traction motors, China accounts for approximately 70% of global extraction and around 90% of midstream separation and refining capacity.

Implications for India

The asymmetric distribution of these assets poses multifaceted challenges for India's strategic and developmental roadmap:

  • Energy Security and Net-Zero Goals: India's target of deploying 500 GW of non-fossil electricity capacity by 2030 and reaching Net-Zero by 2070 is contingent on stable, cost-effective supplies of battery and solar components.
  • Economic Vulnerability and Import Dependence: India is nearly 100% import-dependent for minerals like lithium, cobalt, and nickel. This reliance exposes core domestic manufacturing efforts—such as the Production Linked Incentive (PLI) for Advanced Chemistry Cell batteries and the India Semiconductor Mission—to geopolitical coercion and price shocks.
  • Strategic and Defence Capabilities: Critical materials such as titanium, niobium, and beryllium are indispensable for aerospace engineering, satellite development, and advanced defence modernisation.

India's Policy and Strategic Measures

  • Legislative Enablement: The Mines and Minerals (Development and Regulation) Amendment Act, 2023 removed minerals such as lithium and niobium from the restricted atomic minerals list, enabling commercial exploration and private sector auctioning of blocks.
  • Institutional Backing: The launch of the National Critical Mineral Mission (NCMM) with an outlay of ₹16,300 crore is designed to incentivize domestic exploration, mining, processing, and recycling.
  • Overseas Asset Acquisition: Khanij Bidesh India Ltd (KABIL), a joint venture of central public sector enterprises, secured lithium exploration blocks in Argentina to build equity reserves abroad.
  • Multilateral Coalitions: India joined the US-led Mineral Security Partnership (MSP) to build diversified, friend-shored supply networks and diminish single-source vulnerabilities.

Conclusion

While India has instituted a robust upstream framework to secure raw critical minerals globally and domestically, true strategic autonomy requires closing the midstream gap. Fostering domestic processing, separation, and metallurgical capabilities, combined with an aggressive e-waste recycling ecosystem, will be vital for long-term mineral resilience.

Key facts to remember

definition
Critical Minerals

Mineral resources essential for economic development and national security whose supply chains are vulnerable to disruption, lack viable substitutes, and are integral to green technologies.

statistic

China controls roughly 70% of global rare earth extraction and nearly 90% of downstream separation, refining, and magnet manufacturing capacity.

scheme
National Critical Mineral Mission (NCMM)

Approved with an outlay of ₹16,300 crore to secure domestic extraction, build refining capacities, advance recycling technologies, and support overseas asset acquisition.

example
KABIL's Overseas Lithium Acquisition

Khanij Bidesh India Ltd (KABIL) signed an agreement with Argentina's CAMYEN to explore and develop five lithium brine blocks in Catamarca province.

Frequently asked questions

What is the 'midstream gap' in critical mineral supply chains?

The midstream gap refers to the acute shortage of domestic refining, smelting, and chemical processing capacity, forcing mineral-rich or importing nations to rely on a single dominant processor (predominantly China) even after extracting raw ores.

← All questions on this topic (169)