Critical minerals have decisively moved from the margins of resource policy to the centre of strategic and economic security discourse, a shift explained in detail in an editorial in this edition. Lithium, cobalt, nickel, graphite, copper, and rare earths are now indispensable to electric vehicles, batteries, storage, renewable energy systems, semiconductors, defence platforms, and advanced manufacturing. As decarbonisation and digitalisation accelerate globally, mineral security is becoming as important to national strategy as energy security was through the twentieth century.
The global picture is one of striking concentration: China refines over 90 percent of rare earths and roughly 70 percent of lithium chemicals, giving it dominant leverage over processing even where raw extraction occurs elsewhere. This concentration converts what should be a purely commercial resource question into a matter of geopolitical vulnerability, particularly for countries like India that are simultaneously trying to expand clean energy capacity, electric mobility, semiconductor manufacturing, and defence self-reliance. India’s policy response has included the launch of the National Critical Mineral Mission and reforms to auction processes for critical mineral blocks, positioning this as a major test case of India’s ability to translate strategic awareness into operational capacity.
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For UPSC and SSC aspirants, critical minerals sit at the intersection of GS Paper III topics — science and technology, economy, energy, and infrastructure — and GS Paper II geopolitics, making it one of the most multidimensional and consistently examinable current affairs themes of the current cycle.
Background and Context
India’s demand for critical minerals is projected to grow sharply as its clean-energy transition accelerates — global demand for these transition minerals could nearly double, from around 66 million tonnes in the present to significantly higher levels by 2070, with a more than 51 percent jump in copper demand alone over the current decade, according to the analysis presented in this edition. India holds domestic potential — including reserves of lithium (around 5.9 million tonnes identified, chiefly in Jammu and Kashmir’s Reasi district), copper (roughly 9.3 million tonnes), graphite (21.6 million tonnes), and nickel (189 million tonnes) — but remains heavily import-dependent for processing and refining capacity, particularly in lithium, cobalt, and nickel and wholly dependent for rare earths processing.
Five Important Key Points
- China currently controls over 90 percent of global rare earths processing capacity and roughly 70 percent of lithium chemicals processing, giving it outsized geopolitical leverage in clean-energy and defence-linked supply chains.
- India launched the National Critical Mineral Mission (NCMM), targeting 1,200 exploration projects by 2030-31 and the auctioning of at least 50 overseas mining assets, alongside the acquisition of domestic mineral deposits across states including the Khanij Bidesh India Limited (KABIL) push into Argentina’s Catamarca lithium province.
- Domestic reserves include an identified 5.9 million tonnes of lithium in Jammu and Kashmir, alongside cobalt, rare earths, and graphite deposits in Odisha, Andhra Pradesh, and Tamil Nadu, though extraction and beneficiation capacity remains nascent.
- Copper demand alone is projected to grow at over 51 percent above current levels through the decade, straining India’s bulk-mineral processing capacity, which remains constrained by limited high-purity input facilities and copper smelting expansion needs.
- India signed a rare earths and critical minerals framework agreement with the United States, expected to become operational around May 2026, adding an international dimension to India’s diversification strategy away from China-dependent supply chains.
Historical and Legislative Framework
India’s mineral governance is anchored in the Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act), amended significantly in 2023 to enable auction of critical mineral blocks and permit exploration by private players, including through Exploration Licences — a category introduced specifically to attract high-risk greenfield exploration investment. The 2023 amendment also removed six minerals, including lithium, from the list of “atomic minerals,” enabling private and foreign investment in their exploration and mining, a reform directly triggered by the recognition of their strategic importance in clean-energy and defence value chains.
Government Policy and Scheme Details
The National Critical Mineral Mission, approved by the Union Cabinet with a substantial multi-year outlay, integrates exploration, mining, processing, and recycling into a single strategic architecture. Domestically, the Geological Survey of India (GSI) has intensified exploration for lithium, rare earths, and cobalt across Jammu and Kashmir, Rajasthan, Karnataka, and Chhattisgarh. Internationally, KABIL — a joint venture of NALCO, Hindustan Copper, and Mineral Exploration Corporation — has pursued overseas asset acquisition, exemplified by its stake in the Argentine lithium project, part of India’s broader strategy of “critical mineral diplomacy.”
Economic Implications and Data
India’s clean energy and strategic ambitions are mineral-intensive under any scenario: solar photovoltaic manufacturing requires copper, silicon, and silver; battery storage requires lithium, cobalt, nickel, and graphite; and wind power and electronics require rare earths and semiconductors. As the editorial notes, this convergence of clean-energy transition, digitalisation, and defence modernisation is being termed the “double helix” of contemporary security threats — where mineral scarcity intersects with cyber vulnerability in emerging technologies such as Artificial Intelligence (AI) systems, both of which depend on rare earth-based components and chips.
Governance Concerns and Institutional Issues
India’s mineral security strategy faces structural constraints: exploration remains slow relative to global peers due to regulatory delays, private investment participation is still nascent despite the 2023 reforms, land acquisition and rehabilitation processes are contentious, and environmental clearances for mining in ecologically sensitive regions such as the Aravalli hills or forested belts of central India remain a persistent bottleneck. Processing is an even larger constraint than raw exploration, since India lacks high-purity input facilities, copper smelting capacity, and rare earth separation technology comparable to China’s decades-long head start.
Geopolitical Dimension
Clean energy transitions will require rare earth production to grow nearly 170 percent by 2070 under current trajectories, and China’s dominance in processing gives it a chokehold comparable to OPEC’s historic leverage over oil markets. The European Union’s Critical Raw Materials Act, the United States’ domestic benchmarks of 60 percent extraction and 25 percent processing self-sufficiency by 2035, and Australia’s critical minerals partnerships all illustrate a global race toward supply chain diversification through partnerships — a race in which India’s Quad partnerships, the India-U.S. critical minerals framework, and engagement with Australia’s critical minerals reserve are significant strategic assets.
Bihar’s Connection to Mineral Security
While Bihar is not among India’s leading states for critical mineral reserves, it retains legacy mica belts in the Gaya-Nawada-Jamui region — historically significant for India’s mica exports — and its geological proximity to Jharkhand’s mineral-rich Chotanagpur plateau positions it as a potential beneficiary of downstream mineral-processing investment if national policy incentivises value-addition clusters closer to eastern India’s raw material sources rather than concentrating processing solely in western and southern states. Bihar’s Department of Mines has periodically flagged the state’s potential for rare-earth-bearing pegmatite exploration in its southern districts, a subject that could gain renewed relevance as the National Critical Mineral Mission expands exploration nationally.
Challenges in Implementation
India’s mineral strategy confronts a triad of challenges: geological uncertainty in exploration outcomes, capital intensity and long gestation periods that deter private investment despite policy reform, and processing bottlenecks that mean even successful domestic extraction may still require export of raw ore for overseas refining, undermining the goal of true supply chain self-reliance.
Way Forward
India should prioritise mid-stream processing and refining capacity alongside exploration, given that raw material access without processing capability replicates rather than resolves import dependency. Diversifying international partnerships (Australia, U.S., select African nations), strengthening KABIL’s overseas acquisition pipeline, streamlining environmental and forest clearances through time-bound single-window mechanisms, and building strategic mineral reserves analogous to petroleum reserves are essential next steps, as noted in this edition’s analysis.
Relevance for UPSC and SSC Examinations
Relevant for UPSC GS Paper III (Science and Technology, Infrastructure, Energy, Economy) and GS Paper II (International relations, resource diplomacy). Key terms: National Critical Mineral Mission (NCMM), MMDR Act 1957 (2023 amendment), Exploration Licence, KABIL, Geological Survey of India (GSI), rare earths, critical minerals, India-U.S. critical minerals framework, EU Critical Raw Materials Act.