Critical Minerals: Fueling Geopolitical Rivalries, Shaping India’s Future

The global energy transition, coupled with the rapid expansion of digital technologies and advanced manufacturing, has propelled critical minerals to the forefront of international diplomacy and economic strategy. These minerals – including lithium, cobalt, rare earths, nickel, and graphite – are indispensable components for electric vehicles, renewable energy infrastructure, semiconductors, and defence applications. Their concentrated supply chains and burgeoning demand have ignited a fierce geopolitical competition, transforming them from mere commodities into strategic assets. Nations are increasingly viewing secure access to these resources as paramount for national security, economic resilience, and technological sovereignty. The growing trend of Resource Nationalism, where states assert greater control over their natural resources, further complicates global supply dynamics.

The global scramble for critical minerals is fundamentally reshaping international relations and economic dependencies.

The geopolitical challenges surrounding critical minerals stem from several structural drivers. Firstly, geographical concentration: a few countries dominate either the extraction or the processing of these minerals. For instance, China controls a significant share of rare earth processing and refining, while the Democratic Republic of Congo is a primary source of cobalt. This creates acute supply chain vulnerabilities, making downstream industries susceptible to geopolitical shocks, trade disputes, or export restrictions. Secondly, the demand surge driven by decarbonisation targets and technological advancements far outstrips current diversified supply capabilities, leading to price volatility and intense competition for new reserves. Thirdly, the environmental and social costs associated with mining and processing, particularly in developing nations, often fuel local opposition and ethical concerns, impacting supply stability. Lastly, the lack of transparent global governance mechanisms for critical mineral trade and extraction exacerbates unilateral actions and protectionist tendencies.

For India, the implications are profound. As a rapidly developing economy committed to an ambitious energy transition and ‘Make in India’ initiatives, secure access to critical minerals is non-negotiable. Dependence on a few suppliers, particularly those with geopolitical rivalries, poses significant risks to India’s manufacturing sector, especially in electric vehicles, solar power, and defence production. It could compromise India’s strategic autonomy, making its foreign policy vulnerable to resource leverage. Globally, the critical minerals race is intensifying great power competition, particularly between the US and China, with both seeking to secure and de-risk their supply chains. This could lead to the formation of new alliances centered on resource security, increased investment in resource-rich developing nations, and potential for trade wars or even proxy conflicts over mineral-rich territories. The existing multilateral order, already strained, faces further fragmentation as nations prioritize their resource security over collective action.

Recognising the strategic imperative, India has initiated a multi-pronged foreign policy response. Domestically, the government has identified a list of 30 critical minerals and is promoting indigenous exploration and processing. Internationally, India established Khanij Bidesh India Limited (KABIL) to identify and acquire critical mineral assets abroad, leading to agreements for lithium blocks in Argentina and exploration rights in Australia. India is actively engaging in multilateral forums like the Quad Critical and Strategic Minerals Dialogue, aiming to build resilient supply chains with like-minded partners. Participation in initiatives like the Minerals Security Partnership (MSP) and the Indo-Pacific Economic Framework (IPEF) underscores India’s commitment to diversifying sources and collaborating on technology and investment. Bilateral agreements with resource-rich nations in Africa, South America, and Australia are being prioritized to secure long-term off-take agreements and joint ventures, moving beyond mere trade to strategic partnerships.

Beyond traditional diplomacy and resource acquisition, innovation is crucial for a sustainable critical minerals strategy. Firstly, fostering a circular economy model through advanced recycling technologies for materials like rare earths and lithium-ion batteries can significantly reduce primary mineral demand. Secondly, investing heavily in research and development for alternative materials and substitution technologies can mitigate reliance on scarce minerals. Thirdly, exploring new frontiers like deep-sea mining, while navigating its complex environmental and governance challenges, offers a potential avenue for new supplies. Fourthly, developing robust international frameworks for fair and transparent mineral trade, investment, and environmental standards is essential to prevent a race to the bottom. Finally, enhancing domestic processing capabilities and value addition, alongside strategic stockpiling, will build resilience against supply disruptions.

India’s strategic interests in critical minerals are intrinsically linked to its pursuit of strategic autonomy and its vision of becoming a leading global power. Reducing dependence on a single source, particularly for inputs vital to its industrial growth and defence, is paramount to maintaining an independent foreign policy. Building a robust domestic ecosystem for critical minerals, from exploration to processing and manufacturing, directly supports India’s ‘Atmanirbhar Bharat’ (self-reliant India) agenda. This self-reliance extends to strategic sectors like defence electronics, advanced telecommunications, and electric mobility, where the availability of these minerals can make or break manufacturing ambitions. Furthermore, securing critical mineral supply chains is crucial for India’s long-term economic stability and its ability to compete in high-tech industries, directly impacting initiatives like India’s silicon ambition and its broader digital economy goals.

Regionally, the critical minerals race is reshaping dynamics in the Indo-Pacific, Africa, and Latin America. China’s extensive investments in mining and infrastructure across these regions, often linked to its Belt and Road Initiative, give it significant leverage. Western powers, led by the US and EU, are now actively countering this influence through their own investment and partnership initiatives, seeking to diversify their supply chains away from Chinese dominance. This creates both opportunities and challenges for developing nations, which can leverage their mineral wealth for economic development but also risk becoming pawns in great power rivalry. Globally, the push for green technologies also places environmental considerations at the forefront, demanding responsible mining practices and robust international collaboration to prevent ecological damage and ensure equitable benefit sharing, especially from common heritage areas like the deep seabed.

As of early 2026, the global critical minerals landscape continues to evolve rapidly. India recently expanded its critical minerals list to 30, underscoring the government’s commitment to strategic resource planning. KABIL has further solidified its presence in Latin America, securing exploration rights for two new lithium blocks in Chile, building on its earlier success in Argentina. Globally, the US-EU Critical Minerals Alliance has announced a multi-billion-dollar investment package for processing facilities in Canada and Australia, specifically targeting nickel and cobalt. Simultaneously, China has responded by tightening export controls on certain rare earth processing technologies, signalling an intensification of the resource competition. These developments highlight the ongoing, dynamic nature of critical mineral geopolitics, with nations constantly recalibrating their strategies amidst evolving supply and demand pressures.

1. Analyze how the geopolitics of critical minerals impacts India’s strategic autonomy and its aspirations for an ‘Atmanirbhar Bharat’.
2. Critically examine the structural drivers behind the global scramble for critical minerals and their implications for the international order.
3. Discuss India’s foreign policy initiatives to secure critical mineral supply chains. What innovative strategies can further strengthen its position?
4. Evaluate the role of multilateral forums and bilateral partnerships in addressing the challenges of critical mineral resource security.
5. “The energy transition cannot be truly green without addressing the geopolitical and environmental challenges of critical mineral extraction.” Comment.

This topic directly maps to GS-II: International Relations — India and its neighbourhood relations; Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests; Effect of policies and politics of developed and developing countries on India’s interests, Indian diaspora. It also touches upon issues related to economic development and strategic security.

5 Key Ideas:
1. Resource Security as National Security.
2. Energy Transition’s Mineral Intensity.
3. Supply Chain Vulnerability & Concentration.
4. Circular Economy for Mineral Resilience.
5. Strategic Autonomy through Diversification.

5 Key IR Terms:
1. Resource Nationalism
2. Mineral Security Partnership (MSP)
3. Indo-Pacific Economic Framework (IPEF)
4. Critical Raw Materials Act (EU)
5. Friendshoring/Allyshoring

5 Key Issues:
1. China’s Processing Dominance (e.g., Rare Earths)
2. Ethical Sourcing & Child Labour (e.g., Cobalt in DRC)
3. Environmental Impact of Mining
4. Price Volatility & Market Manipulation
5. Lack of Global Governance Framework

5 Key Examples:
1. Lithium for EV batteries.
2. Cobalt for high-performance batteries.
3. Rare Earths for magnets in wind turbines.
4. Graphite for anode material in Li-ion batteries.
5. Gallium and Germanium for semiconductors.

5 Key Facts:
1. China processes ~60-70% of global rare earths.
2. DRC accounts for ~70% of global cobalt supply.
3. IEA projects a 4x increase in mineral demand by 2040 for clean energy.
4. India’s KABIL has secured exploration rights for lithium in Argentina.
5. A typical EV battery requires over 100 kg of critical minerals.