India’s Critical Mineral Diplomacy: A Strategic Response to China’s Supply Chain Dominance

Keywords: critical minerals, India-China rivalry, supply chain resilience, green energy minerals, rare earth metals, India strategic partnerships, mineral diplomacy,

In the rapidly evolving landscape of global geopolitics, critical minerals have become the new oil. Essential for the green energy transition and advanced technology, these minerals, such as lithium, cobalt, nickel, and rare earth elements, are central to sustainable development. As the world shifts toward renewable energy and electric vehicles (EVs), control over these resources is now a significant factor in global power dynamics. India, recognizing the strategic importance of critical minerals, is actively pursuing mineral diplomacy to reduce its supply chain vulnerabilities and counter China’s dominant position in this sector.

The Strategic Importance of Critical Minerals

Critical minerals are vital for economic development and national security due to their use in renewable energy technology, battery storage, electronics, and defense applications. However, their scarcity and uneven geographic distribution create potential supply chain risks. A disruption in these minerals can impact key industries, making supply chain resilience essential. India’s increased focus on securing these resources is a strategic response to the potential risks posed by a supply chain highly concentrated in a few regions, especially as China’s dominance in mineral processing grows.

China’s Dominance and Supply Chain Vulnerabilities

China has cemented itself as a leader in critical minerals, controlling major portions of the midstream and downstream supply chain. While it does not dominate raw material extraction—led by countries like Australia (lithium), Chile (lithium), the Democratic Republic of Congo (cobalt), and Indonesia (nickel)—China holds a substantial share of the processing capabilities, which are crucial for turning these raw materials into usable forms. Specifically, China processes 68 percent of the world’s nickel, 40 percent of copper, 59 percent of lithium, and 73 percent of cobalt. This concentration gives China significant leverage over the global supply chain and raises concerns about the potential weaponization of resources in geopolitical conflicts.

India’s Strategic Partnerships in Critical Mineral Diplomacy

India is taking strategic steps to secure access to critical minerals through alliances with resource-rich countries and technology-sharing agreements. Key partnerships include alliances with Australia and Chile for lithium, as well as initiatives to collaborate with African nations for other essential minerals like cobalt. Through these partnerships, India aims to diversify its sources, creating a more resilient supply chain less dependent on any single region. Additionally, India is collaborating with the Quad (comprising the U.S., Japan, and Australia) and joining initiatives like the EU-India Trade and Technology Council to strengthen its access to critical minerals and processing technologies.

Building Resilient Supply Chains: Lessons from China

• To counter China’s stronghold in mineral processing, India is investing in domestic processing capabilities and entering technology-transfer agreements to improve its midstream and downstream production. India’s initiatives in lithium-ion battery manufacturing, EV development, and green hydrogen production underscore its commitment to building an independent supply chain. Learning from China’s focus on processing and refining, India aims to create self-sufficiency in the processing segment to mitigate dependency risks.

Conclusion

As the demand for critical minerals grows, securing these resources will play an increasingly important role in national strategy and global alliances. India’s efforts to diversify its supply sources and build processing capabilities demonstrate a proactive approach to reduce its vulnerability and compete with China’s supply chain influence. By focusing on strategic partnerships and technological advancement, India is well-positioned to navigate the complex terrain of critical mineral diplomacy, ensuring energy security and promoting sustainable growth in an era defined by the green transition.

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