CSEP and three other research think tanks, CEEW, ICRIER and IISD, have been working together on the issues of Critical Raw Materials for Low Carbon Technologies coordinated by the Shakti Sustainable Energy Foundation. A joint Whitepaper on the subject is being written. A mid-term workshop on this subject was held at Hotel Ambassador on January 30-31, 2024. CSEP organised the Plenary Session 1 and Roundtable Session 2 on January 30.

VL Kantha Rao (Secretary, Ministry of Mines) delivered the keynote address in the Inaugural Session. Veena Kumari D. (Joint Secretary, Ministry of Mines) gave a special address in the Closing Plenary. Rajesh Chadha and representatives from other partner organisations provided closing remarks and takeaways from the Workshop.

Plenary 1: Strategies and Policies for Developing Resilient Critical Minerals Value Chain in India

The session’s objective was to highlight India’s need for critical minerals to move to the net-zero target by 2070 and to lay the path for achieving this goal.

Chair/Moderator:

Rajesh Chadha (Senior Fellow, CSEP)

Keynote:

Pankaj Satija (Managing Director, Tata Steel Mining)

Panellists:

Saravanabhavan (Deputy Adviser, NITI Aayog)

Rakesh Paliwal (Head, Strategy & Business Development, Aditya Birla Group)

Amit Bhargava (Partner, Metals and Mining, KPMG)

Technical Session 2: Roundtable on Critical Minerals in India: Enabling Sustainable Mining Practices

A backdrop note was prepared based on CSEP research findings in the Whitepaper. Each panellist was prompted with three questions for discussion during the roundtable:

1. What challenges are faced in exploring and allocating critical and deep-seated minerals?
2. What are India’s advantages in the critical minerals value chains, and where can India consolidate with global value chains?
3. How can India strengthen its Environment Impact Assessment (EIA) and Social Impact Assessment (SIA) regulations to enable sustainable mining?

Chair/Moderator:

Rajesh Chadha (Senior Fellow, CSEP)

Presenters:

Karthik Bansal (Research Analyst, CSEP)

Ganesh Sivamani (Research Associate, CSEP)

Panellists:

Amit Bhargava (Partner, Metals and Mining, KPMG)

Damon DuBord (First Secretary, US Embassy New Delhi)

Gouranga Sen (Group Head, Economic & Policy Analysis, Vedanta Group)

Parveen Kumar (Senior Program Manager, Electric Mobility, World Resources Institute)

Rakesh Paliwal (Head, Strategy & Business Development, Aditya Birla Group)

Closing Plenary – Remarks by Rajesh Chadha

Given the net-zero emissions target by 2070, India’s demand for critical minerals will likely rise exponentially. Today, a major challenge is transitioning from an import-dependant to self-sufficient country for the minerals required to manufacture requisite green technologies. Plenary 1 and Technical Session 2 focused on policies that can help enhance India’s capacity to participate in the global minerals value chain.

India has large resources of critical minerals like Cobalt, Copper, Lithium, Zinc and REEs (such as Neodymium). Still, only a small percentage of these resources have been converted to mineable reserves. Many critical minerals are deep-seated, thus requiring high-risk investments in exploration and mining. A key policy focus must be incentivising private-sector investment in domestic mineral exploration. The Ministry of Mines has introduced a new Exploration License system in August 2023. The EL allows any private exploration company to bid for the reconnaissance and detailed exploration of various minerals listed in the MMDR Act. EL follows a reverse bidding process wherein the exploration company bids for a share of the auction premium if the mining lease gets granted.

Two major concerns regarding ELs were highlighted in the discussions: (a) exploration companies are not conferred any mining rights under this licensing regime, and (b) the returns on exploration investment may only be received long-term when mining activities commence in the explored region. The research team shared its recommendations on expanding the current Composite License system’s scope to address the private exploration concerns. The team received valuable feedback on these recommendations.

The discussions also highlighted the need to focus on sustainable mining practices across the value chain and to mitigate negative externalities on communities living in mining-affected regions. There is a growing concern due to the increased conflicts in land rights that have led to many communities not being adequately compensated when displaced. Similarly, granting mining leases in forest areas or wildlife zones has led to long delays in granting environmental clearances. The panel discussions recognised the need for changes in mineral allocation policies to account for the rights of communities and ecosystems, including providing pre-embedded clearances for mining leases.

The discussions also called for global technology cooperation in exploration, mining, processing and recycling. Cooperation and information sharing can also help reduce the negative externalities across critical mineral value chains in India by imbibing international good practices and standards. India’s government and private sector need to increase their investment in technology development to boost their domestic mineral capacity.

Critical mineral processing is still at a nascent stage in India, with domestic processing capacity available for only a few minerals, including copper, zinc and graphite. It is important to create strategies for processing critical minerals that are domestically mined, providing incentives to mineral processing companies. With the recent lithium discovery and the auctioning of 20 critical minerals blocks, the government is making significant progress in bolstering India’s critical minerals sector.

All content reflects the individual views of the speakers. The Centre for Social and Economic Progress (CSEP) does not hold an institutional view on any subject.