India joined MSP and identified 30 critical minerals in June 2023, highlighting a push for metallurgical progress and sustainable ties.
Two important developments in June 2023 have significantly impacted India’s mineral and rare earth sector. Firstly, India become a member of the Mineral Security Partnership (MSP), aiming to ensure responsible production, processing, and recycling of critical minerals. This partnership aligns with the goal of maximizing economic benefits from geological resources from international markets to support the growth of the green and renewable energy sector in India. Secondly, the government of India has listed 30 critical minerals, paving the way for strategic planning to mitigate supply chain risks and cater the demands of Industry 4.0 and other economic requirements.
While these developments are commendable, India must go beyond them to foster sustainable self-reliance in minerals and rare earth. Additional steps should be considered to strengthen the sector’s resilience and long-term viability.
Foster Ecosystem
To achieve self-reliance in critical minerals, several crucial aspects should be focused on. Firstly, a comprehensive assessment of the country’s mineral deposits, rare earth element reserves, and critical mineral resources is essential. This evaluation should determine the availability, quantity, quality, and economic viability of these resources for exploitation.
Secondly, significant investment in research and development (R&D) initiatives is paramount. This should be targeted towards advancing metallurgy, mineral extraction, processing, and refining techniques. India’s membership in the Mineral Security Partnership (MSP) can facilitate partnerships between Indian research institutions and counterparts from the 14 member countries, enabling innovation and the development of cutting-edge technologies.
Thirdly, there is a critical need to strengthen the educational infrastructure by promoting specialized courses and degree programs in metallurgy, minerals, and related fields. Establishing training centres and apprenticeship programs will be vital in nurturing a skilled workforce capable of handling advanced mining and processing technologies. China’s success in rare earth mineral mining and processing has been attributed, in part, to its focus on developing world-class institutions in these domains.
Interestingly, as per AREPPIM’s database from 2021, India does not have any metallurgy engineering institute among the top 50, while China and the US boast 16 and 13 institutes, respectively. This highlights the importance of prioritizing the establishment of prestigious metallurgy engineering institutes in India to bridge the gap and nurture excellence in the field. The lack of knowledge and expertise in metallurgy sciences directly affect the fostering of an ecosystem for development of knowledge-base for critical industries be it jet-engine technology, semiconductors chips, photovoltaic cell, aeroplanes and even ship building. Figure 1 as under illustrate the country-wise number of metallurgy engineering institutes. Interestingly, the top 5 of them are from China among even these total 16.
The significance of metallurgical engineering in India’s critical minerals sector cannot be overstated. It plays a pivotal role in various aspects, ranging from extraction and processing to refining and utilization of critical minerals. Highly trained metallurgical engineers contribute to efficient mineral extraction, mineral beneficiation, metallurgical processing, process optimization, alloy development, recycling, quality control, technological advancements, and sustainable mining operations.
To further bolster the development of the sector, it is crucial to build a robust infrastructure that supports the entire value chain of metallurgy and mineral industries. This entails establishing efficient transportation networks for seamless movement of raw materials and finished products, constructing modern mining facilities, and setting up state-of-the-art processing and refining plants.
Additionally, diversifying supply chains and reducing reliance on a single market is paramount. To achieve this, strong trade relationships with other countries should be fostered. For instance, for minerals like cobalt (found in Congo and Australia), lithium (available in Argentina, Bolivia, and Australia), and nickel (abundant in Indonesia, Australia, and Russia), it is essential to negotiate strategic agreements and strengthen diplomatic outreach to secure access to these critical resources.
By prioritizing metallurgical engineering, building robust infrastructure, and establishing strategic trade relationships, India can strengthen its position in the critical minerals sector and ensure a steady supply of these resources for various industries and technological advancements.
Sustainable
Self-Reliance
To establish India’s sustainable reliance on critical minerals, it is crucial to create an investor-friendly environment that attracts foreign direct investment (FDI) in the mineral and metallurgy sectors.
This can be achieved by offering incentives such as PLI in the important sectors (electronic, semiconductors), acquiring mines in overseas market, negotiating rupee contracts (Egypt, Argentina), case-based tax breaks, and implementing streamlined regulations. Encouraging partnerships with international mining and metallurgical companies is also essential to leverage their expertise and capital, particularly in areas where local companies have limited experience. To facilitate systematic investment, the development of a comprehensive policy and regulatory framework is paramount. This framework should support the growth of the metallurgy and mineral sectors, ensuring stability, transparency, and consistency in policies related to mining, trade, taxation, and environmental regulations. Reducing bureaucratic hurdles and eliminating unnecessary red tape is crucial to maintain the enthusiasm and spirit of private players in the industry. Furthermore, emphasizing sustainable and responsible mining practices is essential to minimize environmental impact and promote social responsibility. Stringent yet business-friendly regulations should be formulated and implemented to address environmental protection, land reclamation, and worker safety. This approach will contribute to maintaining a balance between industrial growth and environmental preservation.
In addition, fostering a business ecosystem that encourages adherence to international standards and certifications will enhance India’s reputation as a reliable player and business partner in the global market. This can be achieved by encouraging businesses to meet and exceed international standards, ensuring that ethical practices and sustainability are prioritized throughout the entire value chain. By creating an investor-friendly environment, developing comprehensive policies, promoting sustainable mining practices, and emphasizing
adherence to international standards, India can establish a strong foundation for sustainable reliance on critical minerals while attracting foreign investment and fostering responsible business practices.
Ram Singh is Professor at IIFT, New Delhi. Views expressed are personal.