Introduction

India’s ambition to achieve 500 GW of renewable energy by 2030 and net zero emissions by 2070 depends not just on sunlight and wind but on minerals buried beneath the earth’s surface. Lithium, cobalt, and REEs form the backbone of technologies driving the clean energy revolution. However, India imports almost all of these minerals, exposing its renewable future to external shocks. The article explores how India is gearing up to build a resilient supply chain, promote domestic mining, and move toward a circular economy, turning its green dreams into a self-reliant reality.

India’s Clean Energy Journey and the Mineral Imperative

1. Critical minerals as enablers: They power EV batteries, solar panels, and wind turbines, the pillars of the green transition.
2. Explosive market growth: India’s EV market is projected to grow at a 49% CAGR from 2023 to 2030, driven by the Electric Mobility Promotion Scheme (EMPS) 2024.
3. Battery boom: The battery storage market, valued at $2.8 billion in 2023, is set to surge with renewable energy integration.
4. Import dependency: India currently imports nearly 100% of lithium, cobalt, and nickel, and over 90% of REEs, creating severe strategic vulnerabilities.

Why Dependence is Dangerous: Global Supply Chain Vulnerabilities

1. China’s dominance: Controls 60% of global REE production and 85% of processing capacity, giving it massive leverage.
2. Geopolitical risks: Trade restrictions, conflicts, and supply disruptions can derail India’s energy transition plans.
3. National security angle: Critical minerals are not just about clean energy,  they are strategic assets influencing defence, technology, and economic sovereignty.

India’s Domestic Potential: A Hidden Treasure Beneath the Soil

1. New discoveries: The Geological Survey of India (GSI) identified 5.9 million tonnes of inferred lithium in Jammu & Kashmir in 2023, a major breakthrough.
2. Policy push: The National Mineral Exploration Policy (NMEP), 2016, and amendments to the Mines and Minerals (Development and Regulation) Act, 2021, opened up exploration to private players.
3. Auctions driving interest: In 2023 alone, 20 critical mineral blocks (lithium, graphite, REEs) were auctioned, attracting domestic and multinational bidders.
4. Potential-rich states: Jammu & Kashmir, Rajasthan (lithium), Odisha, and Andhra Pradesh (REEs) have emerged as mineral hotspots.

From Discovery to Refinement: The Missing Link

1. Production bottleneck: India contributes less than 1% of global REE production due to weak refining and processing infrastructure.
2. Need for partnerships: Public-private collaborations can bring in advanced processing technologies and recycling systems.
3. Government incentives: Subsidies, tax breaks, and R&D grants are critical to scale domestic lithium and cobalt pilot projects.

Investment and Policy Momentum: Building the Foundation

1. Regulatory reforms: The Mines and Minerals (Amendment) Act, 2023 allows private exploration but the sector faces high costs and environmental concerns.
2. Economic potential: Mining contributes only 2.5% to India’s GDP, compared to 13.6% in Australia — signalling untapped opportunity.
3. National Critical Mineral Mission (NCMM): With an outlay of ₹34,300 crore, it aims to strengthen the value chain — from exploration to recycling.

Institutional efforts:

1. NMDC diversifying through its Australian arm.
2. IREL (India) Ltd. extracting REEs like neodymium, praseodymium, and dysprosium.
3. KABIL (Khanij Bidesh India Ltd.), formed in 2019, tasked with overseas acquisitions of mineral assets.

Moving Towards a Circular Economy

1. E-waste as opportunity: India produces 4 million metric tonnes of e-waste annually, yet only 10% is formally recycled.
2. Recycling policies: The Battery Waste Management Rules (2022) and E-Waste Management Rules (2022) aim to improve recovery of critical minerals.
3. Challenges: Weak enforcement, poor infrastructure, and lack of awareness hinder progress.
4. Way forward: Public-private recycling hubs can boost technology access, cut costs, and reduce environmental footprint, paving the way for a circular economy.

Conclusion

Critical minerals are the backbone of India’s clean energy transformation. Securing them is not just about green growth, but about economic independence and strategic security. India’s policy thrust through the National Critical Mineral Mission, domestic auctions, and recycling reforms signal intent, but execution remains key. A coherent strategy involving private investment, state backing, and global partnerships can ensure India does not just consume green technology, it creates it. The success of this mission will determine whether India emerges as a leader in the global clean energy race or remains dependent on others for its green dreams.

PYQ Relevance

[UPSC 2022] Do you think India will meet 50 percent of its energy needs from renewable energy by 2030? Justify your answer. How will the shift of subsidies from fossil fuels to renewables help achieve the above objective?

Linkage: India’s ability to meet 50% of its energy needs from renewables by 2030 hinges on securing critical minerals like lithium and REEs that power solar, wind, and EV technologies. A shift of subsidies from fossil fuels to renewables will accelerate domestic mining, recycling, and innovation—building the self-reliant green infrastructure essential for achieving this target.

Get an IAS/IPS ranker as your 1: 1 personal mentor for UPSC 2024

Attend Now