Model Answer
0 min readIntroduction
Critical minerals are elements essential for modern technologies, especially those vital for clean energy transition (e.g., lithium, cobalt, rare earth elements). Their increasing demand, driven by electric vehicles and renewable energy, has spotlighted significant environmental and economic challenges associated with their extraction and processing. While crucial for a net-zero future, the current practices often lead to ecological degradation and complex geopolitical and market instabilities, necessitating sustainable and responsible supply chain management.
Environmental Challenges
- Habitat Destruction and Biodiversity Loss: Mining operations involve extensive land clearing, leading to loss of forests, wetlands, and other critical habitats, disrupting ecosystems and threatening species. For instance, lithium mining in Chile has reportedly destroyed habitats.
- Water Depletion and Contamination: Extraction and processing are highly water-intensive. Pumping lithium-rich brine from aquifers, for example, consumes vast amounts of water, depleting local freshwater supplies and often contaminating them with toxic waste, affecting indigenous communities and agriculture. A 2024 WRI report found that 16% of critical mineral mines are in water-stressed regions.
- Pollution (Air, Water, Soil): Energy-intensive mining and processing activities release significant greenhouse gases. Chemical use in refining leads to water and soil pollution, with leached chemicals posing long-term environmental hazards. Mine tailings, often containing traces of critical minerals, can also contaminate the environment if not managed properly.
- Waste Generation: Large volumes of waste rock and tailings are produced, requiring vast storage areas and posing risks of leakage and contamination.
Economic Challenges
- Supply Chain Vulnerabilities and Geopolitical Risks: Extraction and processing are often geographically concentrated (e.g., China refines nearly 60% of the world's lithium), leading to high import dependence for many countries, including India. This concentration creates strategic vulnerabilities, geopolitical tensions, and risks of supply disruptions.
- Price Volatility: The demand-supply imbalance, geopolitical factors, and speculative activities lead to extreme price volatility for critical minerals (e.g., lithium prices saw a 300% increase in 2021-2022 followed by a 70% decline in 2023). This impacts investment and project viability.
- High Capital and Technological Investment: Developing new mines and processing facilities requires substantial capital, advanced technologies, and long lead times (often over a decade). India, for example, faces challenges in developing competitive processing capacity due to limited technological know-how and high energy costs.
- Lack of Domestic Processing Capacity: Many developing countries, despite having reserves, lack adequate processing infrastructure and technology, forcing them to export raw materials and import refined products, hindering value addition and economic growth. India is highly reliant on imports for many critical minerals like lithium, cobalt, and rare earth elements due to underdeveloped processing capacity.
Conclusion
The extraction and processing of critical minerals present a dual challenge of environmental sustainability and economic security. Addressing these requires a multi-pronged approach encompassing responsible mining practices, investment in cleaner processing technologies like direct lithium extraction, fostering a circular economy through recycling, and diversifying global supply chains. International collaboration and robust domestic policies, such as India's National Critical Minerals Mission, are crucial to ensure a sustainable and equitable transition to a low-carbon future.
Answer Length
This is a comprehensive model answer for learning purposes and may exceed the word limit. In the exam, always adhere to the prescribed word count.