Critical Minerals Push

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India must strengthen its critical minerals strategy amidst China’s export restrictions and global supply chain challenges.

On January 2, 2025, China expanded export restrictions on critical minerals essential for high-tech applications like semiconductors and batteries. This strategic move highlights China's dominance in critical mineral markets, balancing its control over resources with its dependence on global supply chains. The restrictions signal a growing focus on mineral geopolitics worldwide.

India's efforts to develop its critical minerals sector face challenges like underexplored deposits, lack of advanced exploration infrastructure, and unclear commercial viability. Recent policy changes, such as the 2023 Mines and Minerals (Development and Regulation) Amendment, aim to reclassify certain minerals and encourage private investment. However, issues persist, including low interest in auctions and weak incentives for exploration companies.

Key barriers include limited geological data, which creates uncertainty for potential bidders, and inadequate financial incentives for the high-risk exploration phase. Addressing these requires robust exploration policies, streamlined regulatory frameworks, and direct capital support to mitigate risks.

India’s approach to critical minerals is essential for reducing dependency on imports, especially as these materials underpin strategic industries like semiconductors and renewable energy. Institutional and policy reforms are critical to building self-reliance in a globally competitive minerals market.