Critical minerals policy soon to reduce dependence on China

Faced with a high dependence on China, India plans to bring out a policy framework and time-bound action plan for exploration, processing, use, and recycling of critical minerals in the country - an essential step towards self-sufficiency across several sectors and energy transition.

A comprehensive critical minerals (CMs) policy is likely to be announced later this month as inter-ministerial discussions on the plan are close to wrapping up, people aware of the development told ET. Critical minerals (CMs) such as copper, lithium, nickel, and cobalt, and rare earth elements (REEs) are key to clean energy technologies as they are needed for production of wind turbines and solar photovoltaic cells to electric vehicle (EV) batteries and electricity magnets - all witnessing phenomenal growth in demand across the globe. China currently dominates both global concentration of mineral deposits and processing of critical minerals.

It is critical for India to reduce dependency on China and ensure availability of critical minerals and REEs to remain self-sufficient and go ahead with its energy transition plans.

The Ministry of Mines has recently circulated a draft policy and action plan on critical minerals to stakeholder ministries and departments for their views, ET has learnt. Most departments are said to be largely on board and the policy is likely to be made public this month.


"The idea is to start from the scratch," a senior official told ET. "Several nations are vying for critical mineral reserves across the globe and India is already late and needs to catch up fast."

Various government arms, from the ministries of power, new and renewable energy, finance, and defence to National Security Council Secretariat and the Department for Promotion of Industry and Internal Trade (DPIIT), are expected to join hands with the mines ministry in the mission to scout for critical minerals.The latest Economic Survey has, in fact, termed availability of critical minerals and REEs as the possible next "geopolitical battleground" just as crude oil has been over the last fifty years. It has also flagged the need to create "strategic mineral reserves" along the lines of strategic petroleum reserves to ensure a continuous supply of minerals.

MULTIDIMENSIONAL APPROACH
The proposed action plan suggests a multidimensional approach - including attracting private investments - so that India can work on the entire value chain associated with critical minerals, from exploration and processing to usage and recycling.

"A series of steps are envisaged across stakeholder ministries to ease the pathway and address all aspects of the critical minerals value chain," said the official quoted above.

First on the Centre's to-do list is to identify 'critical minerals' for India. While assessments and tentative lists have earlier been drawn up by Niti Aayog and through another DST report, the government is yet to finalise or notify a list of critical minerals for the country. The government will also address other aspects of the critical mineral value chain. The Geological Survey of India (GSI) will embark on a national exploration project to check for the presence of critical minerals in the country.

Considering the centrality of critical minerals to manufacturing across growing sectors, the government is counting on the private sector to join the mission. The finance ministry and DPIIT are expected to work out an incentive plan to boost private sector investment across the CM value chain. Ministries of power and new and renewable energy are expected to assess industry requirements of critical minerals.The Department of Scientific and Industrial Research (DSIR) along with the education ministry and top institutes such as Indian Institutes of Technology (IITs), IISc Bangalore and the Council of Scientific & Industrial Research (CSIR) network will help identify the right technology solutions for processing of critical minerals in the country - a field dominated by China.

The NSCS and the defence ministry are expected to identify possible strategic reserves of critical minerals, as suggested in the Economic Survey.

The survey also recommended policies to encourage investment in internal research, including technological innovation for mineral exploration and processing and development of recycling, reusing, and repurposing (R3) technologies.

The soon-to-be-announced policy has addressed all issues raised in the survey, sources said.