India is heavily dependent on many of the major critical minerals essential to the energy transition, with 100% import dependency for minerals like lithium, cobalt and nickel, according to a new report by the Institute for Energy Economics and Financial Analysis.
For example, a recent study by the Centre for Social and Economic Progress (CSEP) estimates that the demand for copper and nickel from the power sector alone will increase approximately x5.4 and x10.7 by 2025 and 2047, respectively, in the base case Net Zero Emissions pathway.
Minerals at risk include graphite (natural and synthetic), lithium oxide, nickel oxide, copper cathodes,
nickel sulphate, cobalt oxide, and copper ores and concentrates. Such minerals have high import
dependency. India imports some of them from countries with a high geopolitical risk. The countries
with high geopolitical risks are Russia, Madagascar, Indonesia, Peru and China”— India’s Hunt for Critical Minerals report, Institute for Energy Economics and Financial Analysis
India’s strategic concerns are exacerbated by forecasts that global demand for critical minerals will increase x2-3 by 2030.
India’s ambitious targets, including the installation of 500 gigawatts (GW) of renewable energy capacity by 2030 and achieving net-zero greenhouse gas emissions by 2070, are driving the surge in demand. The Centre for Social and Economic Progress (CSEP) estimates that the demand for copper and nickel from the power sector alone will increase by approximately 5.4 times and 10.7 times by 2025 and 2047, respectively, in the base case Net Zero Emissions pathway
In June 2023, the government of India, through an inter-ministerial committee formed by
the Ministry of Mines, identified 30 critical minerals for India based on their economic importance
and supply risks. This list overlaps with some of the critical minerals identified by the US, Canada,
the UK, the EU, Japan and South Korea.
To diversify its sources and reduce dependency on high-risk countries, India can explore investment opportunities in resource-rich, friendly nations such as Australia, Chile, Ghana, and South Africa. This approach could help secure a more stable and reliable supply chain for critical minerals.
Our report on the rise of India and its impact on critical mineral supply: