India Set to Auction 20 Critical Mineral Blocks to Boost Domestic Resources for Green Energy Transition
Image Source: Green Tech Media
In a significant move towards securing essential raw materials for the green energy transition, the Indian government is gearing up to invite bids for 20 critical mineral blocks within the next two weeks. Mines Secretary V L Kantha Rao announced the upcoming auction, emphasizing the strategic importance of minerals such as lithium and graphite for the nation’s economic development and national security.
The auction aligns with India’s broader strategy to ensure an adequate domestic supply of crucial resources required for the green energy revolution. With a focus on lithium and Rare Earth Elements (REEs), India aims to bolster its commitment to energy transition and achieve net-zero emissions by 2070.
Earlier this year, India discovered its first lithium deposits in Jammu and Kashmir, estimated at 5.9 million tones. Subsequently, the government modified mining rules, allowing private miners to explore and extract these valuable materials. The Union cabinet recently approved royalty rates for three critical minerals, setting rates at 3% for lithium, 3% for Niobium, and 1% for REEs.
The move towards domestic sourcing is a crucial step, as India’s reliance on imports for lithium-ion cell manufacturing has been evident. The country imported lithium worth Rs 23,171 crore in FY23 for electric accumulator manufacturing, underlining the necessity of securing these resources domestically.
India has been actively engaging with countries possessing significant mineral resources. Talks with Chile and Bolivia for lithium mining and sourcing have been underway, while discussions with Argentina involve potential acquisition of mineral blocks. The Mines Ministry is also considering non-disclosure agreements with Chile as it explores opportunities for securing these critical minerals.
The global lithium trinity—Chile, Bolivia, and Argentina—holds nearly half of the world’s lithium resources, making these regions crucial for India’s strategic mineral sourcing. Additionally, prominent Indian enterprises such as Coal India Ltd. and NTPC Ltd. are eyeing the mining sector to tap into these essential materials.
As part of its international mineral acquisition strategy, Khanij Bidesh India Ltd., a joint venture involving three government-owned companies, was formed in 2019. This underscores India’s commitment to securing critical mineral assets globally, with a focus on regions like Australia and South America.
The upcoming auction represents a crucial step in achieving resource security, reducing dependence on imports, and supporting India’s ambitious plans for a sustainable and green energy future. The successful bidder will play a pivotal role in contributing to the nation’s energy transition and environmental sustainability.
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