Securing Critical Minerals for Clean Energy

Securing Critical Minerals for Clean Energy
Posted on 09-09-2023

Ensuring a Sustainable Supply Chain for Critical Minerals: India's G20 Leadership

As India prepares to host the G20 Leaders' Summit in New Delhi, there is a growing recognition of the significance of critical minerals in the global transition toward clean energy. This summit offers an opportunity for India to consolidate its efforts in securing supply chains for these essential resources.

Understanding Critical Minerals and Materials: Critical minerals are those whose supply shortage poses a higher risk to the economy compared to other raw materials. Their scarcity can impact economic development and national security, especially if extraction and processing are concentrated in a few geographical locations. Examples of critical minerals include lithium, graphite, cobalt, titanium, and rare earth elements (REE), which play pivotal roles in high-tech electronics, telecommunications, transportation, and defense sectors.

Significance of Critical Minerals:

  1. Economic and National Security: Critical minerals are indispensable for a nation's economic and national security and often have no viable substitutes. They are integral to clean technologies such as solar panels, wind turbines, and batteries.

  2. Building Blocks of Modern Civilization: The deployment of these technologies is crucial for India's sustainability targets, such as achieving 500 GW of non-fossil power capacity by 2030 and reducing emissions by 45% below 2005 levels by 2030. Thus, critical minerals can be considered the foundation of modern civilization.

Why Establishing a Reliable Supply Chain Matters for India: The increasing demand for clean technology has led to a surge in global mining of critical minerals. To reduce import dependency, strengthen national security, and develop a domestic value chain, securing a reliable supply chain for these minerals is imperative. Global supply chains for critical minerals are intricate and can be vulnerable to disruptions caused by trade treaties and geopolitical factors.

Government Initiatives to Promote the Domestic Critical Minerals Sector: The Indian government is committed to the growth of the domestic critical minerals sector, focusing on exploration, processing, use, and recycling. Policy reforms have been implemented through amendments to the Mines and Minerals (Development & Regulation) Act in 2015, 2020, 2021, and 2023. These reforms include the introduction of a new auction regime, collaboration between the public and private sectors, and cooperative federalism.

Outcome of G20 Energy Transitions Ministers' Meeting: Under India's presidency, the G20 Energy Transitions Ministers' Meeting emphasized collaboration, solidarity, and shared responsibility for accelerating clean, sustainable, affordable, and inclusive energy transitions. This includes ensuring energy security, diversifying supply chains, and expanding universal energy access.

The Way Forward: To build a resilient critical minerals value chain, India must engage in collaborative international efforts through multilateral and bilateral engagements. Collective action is crucial to achieving these goals, with India participating in initiatives such as the Minerals Security Partnership (MSP), the Australia-India Economic Cooperation and Trade Agreement (ECTA), and Khanij Bidesh India Ltd's (KABIL) efforts to secure mineral acquisitions abroad.

Conclusion: India's G20 presidency underscores the importance of collective efforts in reducing emissions and mitigating climate change for a shared future. The groundwork laid during this presidency will strengthen India's leadership in securing a sustainable supply chain for critical minerals, aligning with global goals for a cleaner and more sustainable world.

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