Mobilising Industry: Towards Stronger Africa–India Critical Minerals Cooperation

Executive Summary

A new era of resource diplomacy is here. Countries are vying for access to minerals deemed critical—such as lithium, cobalt, and nickel—for their industrial growth, energy transition, and development. While governments remain the primary drivers of efforts to diversify and build resilient supply chains, the role of the private sector is becoming increasingly important.

Medium- and large-scale companies in India, active across the mining value chain, have already invested in or are exploring potential opportunities across African mining jurisdictions. This comes at a time when African governments are calling for greater local value addition, and India’s National Critical Mineral Mission (Ministry of Mines, 2025b) emphasises the development of domestic industry as an urgent policy necessity for the country. As Indian industry seeks to build global partnerships to secure a steady feedstock of raw materials, it is emerging as an operator of the country’s mineral diplomacy. This paper examines the presence of Indian companies in Africa’s mineral sector, identifies their motivations and constraints, and provides policy pathways for strengthening industrial participation in this new dimension of India–Africa engagement.

Overview of the Indian Industry in Africa

Africa is a familiar geography for Indian economic actors. The earliest linkages between these regions were developed, sustained, and cemented by vibrant trade. More recently, businesses of Indian origin, as well as those looking to expand globally from India, have found success in Africa across sectors including pharmaceuticals, agriculture, and infrastructure. This paper examines more than 20 Indian companies present in the upstream and midstream segments of the mining value chain across the continent.

Investment Drivers for Indian Firms Across Africa’s Critical Minerals Sector

The economic rationale that attracts Indian mining companies to African markets has been explored in depth in previous publications (Vaidyanathan, 2025, 2026). Yet there are three interrelated factors that make an urgent case for why New Delhi should enter critical mineral compacts with various African countries.

First, the continent holds over 30% of the world’s critical mineral reserves, with many deposits of high ore grades and concentrations (Denton, 2025). Several mineral-producing states also offer incentives that create diverse investment opportunities for foreign companies, including Indian companies. Further, informal Indian business networks that exist due to geographic proximity and historical ties enable a strong understanding of local market dynamics, especially in countries where institutional support may still be evolving.

Second, in the context of India’s energy transition and growing renewable energy manufacturing needs, such partnerships can help ensure long-term mineral security. As demand for critical minerals is projected to rise significantly in the country, access to a steady feedstock provides companies with a hedge against global price volatility and supply disruptions. It also strengthens their position within global value chains and supports the competitiveness of downstream manufacturing industries, both vital elements of the country’s broader industrial development.

Third, diplomatic channels and institutional familiarity facilitate overseas investment. Government-to-government (G2G) memoranda of understanding (MoUs) between India and select African nations play a role in improving investment climates. According to some interviewees, if implemented effectively and monitored regularly, these arrangements could help reduce policy uncertainty, foster long-term bilateral engagement, and provide a framework for dispute resolution. However, their effectiveness remains uncertain, especially as the feasibility of investment is determined more directly by diverse political and regulatory environments.

African countries are beginning to emphasise local value addition as an instrument of industrial policy, to create jobs, avoid extractive patterns, and build domestic capabilities. India’s evolving diplomacy in the region, powered by its private sector, should therefore be informed by these host-country priorities.

Risk Landscape for Indian Firms in Africa’s Critical Minerals Sector

Indian companies are relatively new participants in African mineral jurisdictions. As the country’s domestic critical minerals ecosystem evolves, instruments extended to support corporations seeking to invest overseas are also being developed. However, these remain largely nascent, and the concerns are numerous. These include the high capital intensity of mining projects, project execution risks, long gestation periods, uncertain returns for exploration and project development, as well as the requirement for continued capital commitment.

The unpredictability of regulatory regimes, the fragility of governance systems, uneven institutional capacity, and inconsistent enforcement practices add further complexities. These factors often lead to increased costs and delays, collectively creating significant operational uncertainty.

Community resistance due to the socio-ecological vulnerabilities of mining could create long-term reputational risks for companies and become a liability for the Indian government. Adopting local as well as international environmental, social, and governance (ESG) standards is crucial. As global supply chains will increasingly begin to prioritise responsible sourcing, there is an economic incentive to adopt these as well.

Policy Pathways to Operationalise Critical Minerals Diplomacy

This paper positions Indian industry not only as a commercial actor but also as a partner in advancing the country’s resource-security objectives. To operationalise New Delhi’s critical minerals diplomacy, three pillars—financial instruments, institutional coordination, and global partnerships—must align.

Financing and Ecosystem Support for Global Critical Mineral Investments

The first pillar outlines ways to mobilise and de-risk capital. To reduce entry barriers and improve project bankability, dedicated financial instruments, such as concessional credit and blended capital models, could be created. Accompanying this, an ecosystem approach would improve project viability. This is to say that, on the one hand, connect mining to infrastructure, energy, and technology, while on the other, introduce mechanisms for time-bound clearances across ministries. Furthermore, establishing international arms of domestic organisations, including the Geological Survey of India (GSI), and empowering Indian embassies to act as bridges to local investment-promotion agencies would help meet host countries’ economic objectives. Finally, creating a country-level risk-intelligence database could aid private-sector decision-making.

Strengthening Diplomatic and Institutional Risk Mitigation

This pillar emphasises deepening existing G2G mineral diplomacy frameworks. It includes the introduction of performance tracking for existing MoUs and dispute resolution mechanisms. It also calls for establishing mineral diplomacy desks in select Indian missions. Additionally, platforms for regular government–industry engagement should be established. This would work to not only capture real-time operational challenges but also integrate feedback into policy revision cycles.

Embedding Responsible Investment and Global Partnerships in Critical Mineral Governance

The final pillar focuses on strengthening India’s long-term strategic position through responsible investment practices and deeper integration into global mineral governance frameworks. Embedding responsible standards in India’s overseas investments and incentivising ESG-aligned projects could enhance market access for India-linked minerals.

Key Conclusions

The architecture of India’s critical minerals diplomacy is under development. To secure the country’s demand for these green minerals, the Indian private sector will have to be supported and mobilised overseas. They are no longer merely beneficiaries of state-led agreements but shape on-the-ground engagement as investors and risk takers.

While the presence of Indian companies across Africa reflects a growing appetite for long-term investment, their motivations are informed by a combination of factors. These range from domestic supply constraints and the need to hedge against dependency on China to exploring the potential offered by African markets.

However, there are clear constraints. High initial costs, unclear regulatory systems, and political or social volatility are some factors that continue to shape investor hesitancy. These risks cannot be addressed through G2G agreements or diplomatic initiatives alone. The future of India’s critical mineral partnerships abroad will depend on how effectively government institutions respond to the needs of industry actors.

The central message is clear. India must scale up its industrial capacity across the critical minerals value chain, from advanced processing and metallurgical expertise to engineering services and equipment manufacturing. Without strong domestic anchors, Indian companies will struggle to compete globally. Developing tailored financial instruments, investing in research and development (R&D), supporting technical-feasibility studies, and building capabilities will be essential. In effect, India’s international presence in critical minerals will be only as credible as the industrial capacity it can demonstrate at home.