India’s Critical Minerals Partnerships with the Gulf Countries: From Oil to Green Energy Transition

From the oil shocks of the 1970s through India’s economic liberalisation and emergence as a global power, the Gulf countries have remained one of India’s most dependable energy partners, accounting for over half of its crude oil imports. As both regions now confront the imperatives of energy transition and economic diversification, India and Gulf Cooperation Council (GCC) countries (Bahrain, Kuwait, Qatar, Oman, UAE and Saudi Arabia) are rapidly expanding cooperation into critical minerals – essential for renewable energy technologies, electric vehicles, and advanced manufacturing.

Significant recent developments include India signing MoUs with Saudi Arabia in February 2025 for joint critical mineral exploration and technology transfer. India also signed an MoU in September 2024 with the United Arab Emirates (UAE) to secure critical minerals supply chains. These developments, aligned with global headwinds in resource diplomacy, mark a shift in India-Gulf relations. From a partnership focused on accessing oil and gas towards securing supply chains for clean energy transition minerals such as lithium, cobalt, rare earth elements, and copper.

India’s National Critical Minerals Mission launched in January 2025 with a ₹34,300 crore ($4.1 billion) investment over seven years, specifically identifies international partnerships as a key mechanism to secure supply chains for critical minerals. Simultaneously, Gulf countries are diversifying their economies away from oil through ambitious mining and processing investments. Saudi Arabia’s Vision 2030 aims to make mining the ‘third pillar’ of its economy with $2.5 trillion in untapped mineral wealth, while the UAE has invested $1.36 billion in lithium processing infrastructure.

Gulf countries are diversifying their economies away from oil through ambitious mining and processing investments.

This article examines how India’s longstanding energy ties with Gulf nations are entering a new era, one in which traditional oil partnerships are expanding to include joint efforts in the critical minerals sector. It analyses the evolution of India’s relationship with the region, and outlines Gulf countries’ domestic policy approaches to critical minerals. It maps the developing clean energy partnership between India and the GCC countries, and proposes actionable strategies for building resilient, secure supply chains that will meet India’s clean energy and manufacturing ambitions.

India-Gulf Relations: A Foreign Policy Transformation

India’s relationship with the Gulf region has historic roots, dating back to Indian merchants traveling to the region to pursue trade. In the early decades after independence, countries like Saudi Arabia, UAE, Kuwait, and Qatar emerged as primary suppliers for India’s growing energy needs. These partnerships deepened in the 1970s oil boom, cementing the Gulf as one of India’s most reliable partners for crude imports and energy security. This partnership continues to be supported by the vast Indian diaspora that contributes to economic and social connectivity across the region.

Bilateral ties expanded rapidly as India established formal diplomatic relations with Saudi Arabia in 1947, with robust energy and trade pacts following in the 1970s. With the UAE, the partnership accelerated after its formation in 1971, and India establishing relations in 1972 leading to flourishing trade and joint ventures through the 1980s and 1990s. Qatar and Oman also became key suppliers and strategic partners, with major liquified natural gas (LNG) and oil contracts signed from the 1980s onward. Bahrain with and Kuwait have also been long term trading partners for India with strong cultural and people-to-people relations.

India’s partnership with the GCC states goes beyond just energy security, to include sectors like trade, labour movement, infrastructure, and investment. As both regions undergo rapid energy transitions and pursue economic diversification, it is natural for the scope of this longstanding partnership to expand into new frontiers, including critical minerals. Against the backdrop of an evolving energy landscape, India and the Gulf states are leveraging their historic ties and complementary strengths to forge partnerships that secure reliable, diversified, and resilient supply chains for the minerals essential to future prosperity.

Against the backdrop of an evolving energy landscape, India and the Gulf states are leveraging their historic ties and complementary strengths to forge partnerships that secure reliable, diversified, and resilient supply chains for the minerals essential to future prosperity.

Recent diplomatic exchanges reflect this strategic evolution. During Prime Minister Modi’s April 2025 visit to Saudi Arabia, both countries signed $100 billion worth of agreements spanning energy, infrastructure, and critical minerals cooperation. The India-UAE Strategic Dialogue held in December 2024 similarly elevated critical minerals to core partnership priorities, with the establishment of working groups on mineral value chains and technology transfer.

The institutional architecture supporting these partnerships includes the deployment of 20 nodal officers at Indian embassies in mineral-rich countries, including Gulf states, to identify opportunities and coordinate investments. The India-Middle East-Europe Economic Corridor (IMEC), announced at the September 2023 G20 summit, stands to provide the infrastructure backbone for seamless critical mineral flows through digital trade corridors and regulatory harmonisation.

Gulf Countries’ Critical Minerals Policies: Strategic Diversification Beyond Oil

The GCC states are also shifting their domestic policy to focus not only on the mining sector but on developing access to critical minerals in line with their own clean energy goals. Table 1 showcases some of the policies these states have undertaken to ensure their domestic ecosystem is more favourable to development of reliable critical mineral supply chains.

Saudi Arabia: Mining as the Third Economic Pillar

Saudi Arabia has embarked on the most ambitious mining transformation in the Gulf, with Vision 2030 targeting mining as the ‘third pillar’ of the economy after oil and petrochemicals. The Kingdom’s estimated $2.5 trillion in untapped mineral wealth includes significant deposits of copper, gold, zinc, and rare earth elements, with ongoing geological surveys revealing additional potential. Policy reforms have created an investment-friendly regulatory environment with streamlined licensing procedures, tax incentives, and direct state investment through the Public Investment Fund (PIF).

Saudi Arabia’s international engagement through the Future Minerals Forum, now in its fourth year with participation from 74 governments including India, demonstrates the country’s ambition to become a global minerals hub. The Forum’s Ministerial Roundtable provides a platform for Saudi-India collaboration on sustainable mining practices, technology transfer, and joint third-country investments, particularly in Africa.

United Arab Emirates: Financial Hub and Processing Centre

The UAE leverages its strengths as a financial and logistics hub to position itself strategically in global critical minerals supply chains. Abu Dhabi’s Khalifa Industrial Zone hosts a $1.36 billion lithium processing facility, while International Resources Holding (IRH) has emerged as a key state-backed entity for international mineral investments. Policy frameworks support both upstream and downstream activities: the UAE provides sovereign backing for international mining acquisitions while developing domestic processing capabilities for critical minerals required in artificial intelligence infrastructure, data centres, and renewable energy systems.

UAE investments in India’s critical minerals sector include partnerships with LOHUM Cleantech for establishing the Middle East’s first EV battery recycling plant in Sharjah, with annual capacity to process 3,000 tonnes of lithium-ion batteries and create 15MWh of energy storage systems. This collaboration aligns with both countries’ net-zero commitments and circular economy objectives.

Oman and Qatar: Targeted Strategic Investments

Oman, under Vision 2040, has liberalised its mining sector with particular focus on copper resources, securing Final Investment Decisions (FIDs) for six major projects including the Mazoon Mining copper ore project and Al Ghuzayn copper mining initiative. The country’s Minerals Development Oman (MDO) operates through a public-private partnerships model and can be leveraged to help develop India’s copper value chain.

Qatar’s sovereign wealth fund, Qatar Investment Authority,  has made strategic investments in critical minerals, including a $180 million investment in TechMet – a US International Development Finance Corporation (DFC) backed investment vehicle – focused on responsible critical mineral sourcing.

Table 1: Timeline of Key GCC Policies on Critical Minerals

Source: Author’s compilation based on various sources.

India’s Collaborations and Agreements

India’s longstanding partnership with the GCC countries, historically centred on oil and energy security, is naturally evolving to include critical minerals cooperation (see Table 3). While India has announced its list of critical minerals in June 2023, the Gulf countries have not identified the same. Yet, by mapping their overseas and domestic investments we can get a clearer picture of the minerals these countries are targeting. While lithium emerges are the only mineral targeting by most of the Gulf countries, copper tops the list for Saudi Arabia, UAE and Oman.

Table 2 showcases which critical minerals the Gulf States are targeting through outward and domestic investments or partnerships and the cross over with India’s critical minerals list. All the minerals targeting by these countries are on India’s list.

Table 2: Common Minerals Between India and the Gulf Countries

Table 3: India’s Cooperation With the Gulf for Energy Security

Source: Authors compilation based on various sources. Not exhaustive.

Strategic Opportunities and Future Pathways

This section highlights key avenues to develop and deepen India’s partnerships with Gulf countries, focusing on securing resilient and diversified critical mineral supply chains. These collaborations could support India’s broader goals of achieving a sustainable green energy transition and technological self-reliance.

1. Technology transfer through value chain integration: These partnerships open avenues for technology transfer throughout the entire mineral value chain, from exploration and extraction to processing and recycling. Saudi Arabia’s adoption of artificial intelligence in mining operations, can be facilitated through its MoU with India, highlighting potential for joint sustainable innovation. Meanwhile, the UAE’s focus on advanced battery chemistry development aligns with India’s NCMM research priorities. Together, these efforts can enhance the reliability and diversification of mineral supply chains necessary for clean energy transitions. This cooperation not only improves ecological sustainability but also yields competitive advantages by introducing cutting-edge mining approaches.
2. Triangular Cooperation and African Partnerships: Through existing strong ties with African mineral-producing countries, Gulf states provide critical entry points for collaborative triangular partnerships that include India, the Gulf, and Africa. African nations increasingly seek value addition, aiming to build stronger domestic industries around mineral resources. Gulf states, with investments like the UAE’s $1.9 billion stake in Democratic Republic of Congo mining projects, and Saudi Arabia’s investments in Zambian copper, facilitate access to upstream resources. India can leverages its technical processing and knowledge strengths, and its own relational tied in Africa, to secure supply chains while ensuring equitable benefits flow to all stakeholders, including local communities.
3. Financing Mechanisms and Risk Management: Gulf sovereign wealth funds are well positioned to provide the capital and sound risk-sharing frameworks that critical minerals projects require. Major Gulf funds like Saudi Arabia’s Public Investment Fund, UAE’s Mubadala, and Qatar Investment Authority can act as financial anchors that help mitigate risks in Indian overseas critical mineral projects. Joint investment entities, akin to the model used by the Uzbekistan-UAE Investment Company, can institutionalise Gulf-India cooperation in third-country projects, providing diversified risk exposure and ensuring compliance with regulatory and local partnership standards.
4. Regulatory Harmonisation and Standards Development: As global markets place increasing value on responsible sourcing, Gulf-India partnerships could establish and adhere to common Environmental, Social, and Governance (ESG) standards. Implementing joint compliance frameworks, auditing systems, and robust community engagement initiatives would differentiate Gulf-India mineral supply chains as trustworthy and sustainable. Digital tools building on models like the IMEC’s Master Application for International Trade and Regulatory Interface (MAITRI) system can enable real-time monitoring of ESG adherence, support trade financing, and streamline insurance processes.

India’s partnerships with the Gulf, built on principles of mutual benefit, environmental responsibility, and technological innovation, offer pathways toward more resilient and equitable global mineral governance for the decades ahead.

As the global economy transitions toward clean energy and advanced manufacturing, control over critical mineral supply chains will increasingly determine economic competitiveness and strategic autonomy. India’s partnerships with the Gulf, built on principles of mutual benefit, environmental responsibility, and technological innovation, offer pathways toward more resilient and equitable global mineral governance for the decades ahead.

Note: The author would like to thank Sabine Karer, Research Intern, CSEP for her research assistance and Dr Constantino Xavier, Senior Fellow, CSEP for his feedback.