What are critical minerals?

What’s in today’s article?

• Why in News?
• What are Critical Minerals?
• Identification of 30 Critical Minerals by the Indian Govt
• Other Recommendations of Panel
• Significance of the Identification of Critical Minerals
• Global Practices
• Recent Efforts by the Indian Govt to Boost its Critical Minerals Sector

Why in News?

• In a strategic move, the Centre has identified 30 critical minerals, including lithium, cobalt, nickel, graphite, tin and copper, which are essential for the country’s economic development and national security.

What are Critical Minerals?

• A mineral is critical when the risk of supply shortage and associated impact on the economy is (relatively) higher than other raw materials.
• These minerals are essential for economic development and national security, and their lack of availability/ the concentration of extraction/ processing in a few geographical locations could potentially lead to supply chain vulnerabilities.
• These (such as lithium, graphite, cobalt, titanium, and rare earth elements) are essential for the advancement of many sectors, including high-tech electronics, telecommunications, transport, and defence.
• It forms part of multiple strategic value chains, including –
  • Clean technologies initiatives such as zero-emission vehicles, wind turbines, solar panels;
  • Information and communication technologies, including semiconductors; and
  • Advanced manufacturing inputs and materials such as defence applications, permanent magnets, ceramics.

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Identification of 30 Critical Minerals by the Indian Govt:

• The specific trigger for the exercise is India’s international commitments towards reducing carbon emissions, which require the country to urgently relook at its mineral requirements for energy transition and net-zero commitments.
• The identification of these minerals was done on the basis of a report on critical minerals prepared by an expert team constituted by the Ministry of Mines. The ministry will revisit the list periodically.
• The panel decided to have a three-stage assessment to arrive at a list of critical minerals.
  • In the first stage, the panel looked at the strategies of various countries such as Australia, USA, Canada, UK, Japan and South Korea, and identified a total of 69 elements/ minerals.
  • In the second stage, an inter-ministerial consultation was carried out with different ministries to identify minerals critical to their sectors.
  • The third stage assessment was to derive an empirical formula for evaluating minerals criticality, taking cognizance of the EU methodology that considers two major factors – economic importance and supply risk.
• Based on this process, a total of 30 minerals were found to be most critical for India, out of which two are critical as fertiliser minerals:

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Other Recommendations of Panel:

• The committee also called for a need for establishing a National Institute or Centre of Excellence on critical minerals on the lines of Australia’s CSIRO, which is one of the largest R&D organisations in the world.
• A wing in the Ministry of Mines can be established as a Centre of Excellence for Critical Minerals.
• This proposed Centre will periodically update the list of critical minerals for India, notify the critical mineral strategy from time to time, etc.

Significance of the Identification of Critical Minerals:

• It will help the country to plan for the acquisition and preservation of such mineral assets taking into account the long-term need of the country.
• In turn, it will reduce the import dependency (especially on China) as India is 100% import dependent for certain elements.
• It will help to build competitive value chains in India.

Global Practices:

• The US adopted a two-stage screening methodology (an early warning screening and an in-depth supply chain analyses + inter-agency collaboration) to arrive at the list of critical minerals.
• In the UK, three indicators were used to estimate the production concentration, companion metal fraction and recycling rate.
• The European Commission has been issuing a list of critical raw minerals since 2011 that is updated every three years.
• Japan’s latest perspective underscored the growing importance of critical minerals for EVs and renewable power generation equipment.

Recent Efforts by the Indian Govt to Boost its Critical Minerals Sector:

• The Geological Survey of India (an attached office of the Ministry of Mines) has recently carried out mineral exploration in Salal-Haimna areas (Reasi district, J&K), and estimated 5.9 million tonnes of lithium ore.
• A joint venture company namely Khanij Bidesh India Ltd. (KABIL) is mandated to identify and acquire overseas mineral assets of critical and strategic nature (lithium, cobalt) to ensure supply side assurance.
• India has recently been inducted into the Mineral Security Partnership (MSP), a US-led collaboration of 14 countries that aims to catalyse public and private investment in critical mineral supply chains globally.

Q1) What is the Mineral Security Partnership (MSP)?

The MSP, comprising 14 member states including Australia, Canada, Japan, and the United Kingdom, serves as a strategic alliance aimed at catalysing public and private investment in global critical mineral supply chains.

Q2) What is Khanij Bidesh India Ltd. (KABIL)?

It is a Joint Venture Company among NALCO, HCL and MECL formed in 2019. Target of this company is to identify, acquire, develop, process and make commercial use of strategic minerals in overseas locations for supply in India.

Source: Centre identifies 30 critical minerals: Why, how, and importance of the exercise