India is currently negotiating agreements for long-term access to lithium and rare earth minerals with Brazil, Canada, France and the Netherlands, according to sources.
These agreements will likely involve creating joint exploration, mining, processing and recycling operations; as well as collaborating on developing new technologies for processing these minerals. As a result of recent events, New Delhi is increasingly concerned about protecting its supply chains for clean energy, EVs, electronics and modern infrastructure.
India’s motivation for securing minerals is primarily due to its heavy reliance on China, which is the world’s primary producer and processor of numerous critical minerals. Experts in the field indicate that dependence on China creates both economic and strategic risks for India, especially as competition for limited resources increases globally.
At this point, diversifying suppliers is essential, states one mining analyst. “It forms a core part of India’s energy transition strategy as well as its industrial expansion strategy.
Lithium and rare earth elements (REE’s) are key inputs in the production of electric vehicle batteries, wind turbines, solar panels, and defence products; as part of its 2023 classification system, India has classified over 20 materials as `critical’ for its development.
According to the officials, India plans to use different forms of previous accords made with Germany for mineral development such as exploration and processing.
This present outreach is being facilitated through the Ministry of Mines who are initiating negotiations with several partners.
One source stated that they are making progress on discussions about potential pacts with France, Netherlands and Brazil; and they are currently conducting active reviews on making a deal with Canada.
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Canada visit may seal key deals
Canadian Prime Minister Mark Carney will be visiting India in early March with expectations of signing agreements regarding critical minerals, uranium, energy and artificial intelligence.
Officials from the Canadian government have advised that both Nations will conclude an agreement formalising co-operation on additional levels of Co-operation regarding Critical Minerals prior to the end of 2023.
In addition, the Finance Minister of India, Nirmala Sitharaman, has indicated that Rare Earths related goods and the established supply chain for these products will both receive priority in Budget 2026.
This activity is part of the wider Global Race for the Acquisition/Development of Mineral Resources.
A part of a bigger global competition
India signed mineral pacts with Argentina, Australia, & Japan and is negotiating with Peru & Chile.
These activities are part of a larger movement for diversification of supply chains worldwide. Recently the G7 finance ministers discussed their efforts to decrease their dependence on China for rare earth minerals.
Despite this momentum, experts have warned that mining takes time. It can take from 5 to 7 years just to explore, and then many mining projects never reach production.
Nevertheless, officials believe investing early is key.
India believes that creating partnerships now will provide a way to guarantee future opportunities for access to the minerals needed to transition to clean energy, enhance its manufacturing sector, and reduce strategic dependency in the coming decades.
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