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First-ever Auction of Critical and Strategic Minerals

By Amigos IAS

Why is it in the news?

  • The Ministry of Mines has initiated the first-ever auction of Critical and Strategic Minerals in India.
  • Twenty blocks containing these minerals are being auctioned, strategically located across the country.
  • The Centre for Socio and Economic Progress (CSEP) assessed mineral criticality in India based on economic importance and supply risks.

More about the news

  • Critical minerals are identified based on a higher risk of supply shortage and their significant impact on the economy.
  • The risk assessment considers factors such as import dependence, recycling potential, and substitutability.
  • The lack of availability or concentration of extraction in a few countries poses supply chain vulnerabilities.
  • Global economic transitions, such as the shift to clean energy, will drive demand for minerals like lithium, graphite, cobalt, titanium, and rare earth elements.
  • India aims for 50% of cumulative electric power capacity from non-fossil sources by 2030.

Recent Developments

  • Amendment in the Mines and Minerals (Development and Regulation) Act designates 24 minerals as Critical and Strategic, granting the Central Government power for mineral concession and prioritized auctions.
  • The 24 minerals include Antimony, Arsenic, Barium, Beryllium, Bismuth, Boron, Chromium, Cobalt, Copper, Gallium, Germanium, Graphite, Hafnium, Indium, Lithium, Magnesium, Molybdenum, Niobium, Nickel, Platinum Group Metals (PGMs), Rare Earth Elements (REEs), Rhenium, Selenium and Silicon.
  • Revenue generated from auctions to benefit State Governments.

Domestic and Global Outreach by India

  • Geological Survey of India explores lithium ore resources in Jammu & Kashmir.
  • Khanij Bidesh India Ltd. (KABIL) mandated for acquiring overseas mineral assets.
  • India joins the Mineral Security Partnership (MSP), a US-led collaboration of 14 countries focusing on critical minerals’ supply chains.

 

Mineral Security Partnership (MSP)

About

·       Aims to catalyse public and private investment in critical mineral supply chains globally.

·       Focus on Cobalt, Nickel, Lithium, and 17 rare earth minerals.

·       Members include Australia, Canada, India, the US, and others.

 

Challenges Addressed by MSP

·       Diversifying and stabilizing global supply chains.

·       Promoting investment in supply chains.

·       Ensuring high environmental, social, and governance standards.

·       Encouraging increased recycling of critical minerals.

 

 

Way Forward

  • The auction process is pivotal for India’s economy, national security, and clean energy goals.
  • India should diversify import sources, form strategic partnerships, and collaborate on research and development with developed countries.

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