Critical Minerals: From Mines to Strategic Power

Context

Supply Chain Realignment: The Global Critical Minerals Outlook 2026, released by the International Energy Agency (IEA), highlighted that global demand for critical minerals will continue to rise sharply until 2040, while supply deficits are expected to persist for key minerals such as copper, lithium and cobalt.

The report estimates that more than US$750 billion in mining and refining investments will be required by 2040.
India's Strategic Response: Against this backdrop, India has accelerated the implementation of the National Critical Mineral Mission (NCMM), expanded overseas resource partnerships and intensified domestic exploration activities.
The recent emphasis on processing capabilities, rare-earth manufacturing, recycling, strategic stockpiling and international mineral diplomacy reflects the growing recognition that critical-mineral security is becoming as important as energy security itself.
The India–US Critical Minerals Framework of 2026 further signifies the transition from resource acquisition towards the development of resilient and diversified supply chains.

What Are Critical Minerals and Why Have They Become Indispensable?

Strategic Resource Base: Critical minerals are minerals that are indispensable for economic development, technological advancement and national security, but whose supply chains remain vulnerable to disruption owing to geological scarcity, geographical concentration or technological dependence.
In 2023, the Ministry of Mines identified 30 critical minerals, including Antimony, Beryllium, Bismuth, Cobalt, Copper, Gallium, Germanium, Graphite, Hafnium, Indium, Lithium, Molybdenum, Niobium, Nickel, PGE, Phosphorous, Potash, REE, Rhenium, Silicon, Strontium, Tantalum, Tellurium, Tin, Titanium, Tungsten, Vanadium, Zirconium, Selenium and Cadmium.
Their strategic importance arises not merely from their availability but from the ability to control the entire exploration-to-manufacturing value chain.
Energy Transition Engine: The transition towards clean energy systems is making the global economy increasingly mineral-intensive.
According to the International Energy Agency (IEA), an electric vehicle requires nearly six times more mineral inputs than a conventional vehicle, while an offshore wind power facility requires almost thirteen times more mineral resources than a gas-fired power plant.
By 2040, global demand for lithium is projected to increase by more than 350%, while demand for graphite is expected to more than double.
Consequently, minerals such as lithium, cobalt, nickel, graphite and copper have become indispensable components of the net-zero transition.
Digital Economy Backbone: Critical minerals constitute the foundation of the Fourth Industrial Revolution.
Semiconductors, artificial intelligence (AI), cloud computing, 5G networks, advanced sensors and data centres require critical minerals such as gallium, germanium, indium, silicon and rare earth elements.
The rapid growth of AI, high-performance computing and quantum technologies has increased the strategic importance of these resources.
As a result, technological competitiveness is increasingly tied to secure access to high-purity mineral supplies.
Defence Capability Multiplier: Critical minerals have emerged as indispensable components of modern defence ecosystems.
Neodymium, dysprosium, samarium, tungsten, titanium and zirconium are extensively used in satellites, fighter aircraft, precision-guided missiles, radar systems, submarines and unmanned aerial vehicles.
Recent international experiences (China’s export controls 2025, U.S. Project Vault 2026) have demonstrated that relatively inexpensive rare earth components can determine the operational readiness of highly sophisticated defence platforms.
Mineral security has therefore become an integral component of national security architecture.
Geoeconomic Leverage: Critical mineral supply chains exhibit extremely high levels of geographical concentration.
Recent international assessments by UN Trade and Development indicate that the Democratic Republic of Congo contributes approximately 74% of global cobalt production, while China accounts for nearly 70% of lithium refining, 75% of cobalt refining, 85% of rare-earth separation capacity and more than 90% of battery-grade graphite production.
Consequently, critical minerals have emerged as instruments of geoeconomic statecraft, resource nationalism and strategic competition.
Structural Transformation Catalyst: Critical minerals offer developing economies an opportunity to move beyond traditional extractive models towards green industrialisation.
International experience demonstrates that countries engaged in refining, processing, recycling and advanced manufacturing capture significantly greater economic value than those exporting raw minerals alone.
Therefore, the real source of strategic advantage lies not beneath the ground but across the entire "mine-to-magnet" ecosystem, encompassing extraction, processing, innovation and technological development.

Why Does India Continue to Face Significant Challenges in Building a Resilient Critical-Mineral Ecosystem?

Import Dependence and Supply Vulnerability: India's critical-mineral ecosystem is characterised by a high degree of external dependence.
The Economic Survey (2024–25) observed that 24 of 33 strategically important minerals face a high risk of supply disruption.
India remains entirely import-dependent for 10 critical minerals—lithium, cobalt, nickel, vanadium, niobium, germanium, rhenium, beryllium, tantalum and strontium.
This dependence has become more acute because global production is concentrated in a few countries.
Midstream Processing Deficit: India's principal weakness lies not in mining but in the midstream segment, encompassing refining, purification, separation and metallisation.
The report of Council on Energy, Environment and Water (CEEW) notes that India possesses substantial experience in processing bulk minerals such as iron, aluminium, zinc and lead but lacks adequate capabilities in high-purity critical-mineral processing.
Consequently, domestic industries remain dependent on imported intermediate products and permanent magnets despite the availability of certain mineral resources within the country.
Exploration and Resource Constraints: Despite possessing considerable geological potential, only a limited proportion of India's Obvious Geological Potential (OGP) has been systematically explored.
Long gestation periods, high capital requirements, inadequate geological databases and uncertainties associated with statutory clearances continue to discourage investment.
Moreover, commercially viable reserves of strategically important minerals such as lithium, cobalt and nickel remain limited.
Although India possesses sizeable resources of copper, graphite and rare earth-bearing monazite deposits, the quantity, quality and accessibility of these resources remain major constraints.
Technological and Innovation Gaps: The transition from resource extraction to advanced manufacturing demands technologies such as direct lithium extraction, solvent extraction, electrowinning, hydrometallurgy and high-pressure acid leaching.
However, domestic commercialisation remains limited.
According to the National Critical Mineral Mission (NCMM), India aims to develop 1,000 patents and establish seven Centres of Excellence by 2030–31, reflecting the existing innovation deficit.
Furthermore, battery-grade graphite requires purity levels approaching 99.95%, highlighting the technological sophistication required for downstream manufacturing.
Circularity and Sustainability Challenges: Although recycling is increasingly recognised as a strategic resource, India's circular economy ecosystem remains underdeveloped.
The country's annual e-waste generation of nearly 1.75 million tonnes is expected to rise sharply in the coming decades, yet formal collection systems remain weak and lithium-ion recycling capacity remains inadequate.
Simultaneously, mining activities involve significant ecological costs, including land degradation, water pollution and biodiversity loss.
Geopolitical Risks and Regulatory Complexity: The number of export restrictions on critical minerals has increased sharply since 2020.
China's export controls on rare earths and battery materials, coupled with restrictions imposed by countries such as the Democratic Republic of Congo, Zimbabwe and Mozambique, have heightened supply-chain risks.
Moreover, overlapping responsibilities across multiple ministries and regulatory agencies continue to increase compliance costs and delay project implementation.

What Measures Can Transform India from a Mineral Importer into a Critical-Mineral Powerhouse?

Value-Chain Sovereignty: India must shift its focus from merely securing mineral deposits to securing the entire "mine-to-magnet" value chain, encompassing exploration, refining, separation, metallisation, advanced manufacturing and recycling.
The ultimate objective should be to maximise domestic value addition, technological capabilities and strategic autonomy.
Exploration Intensification: A specialised risk-sharing financing mechanism integrating public investment, private capital and advanced geoscientific technologies should be developed to accelerate exploration.
Greater use of artificial intelligence, predictive geological modelling, deep-earth imaging, hyperspectral mapping and digital resource mapping can improve discovery rates and reduce project uncertainty.
Processing and Technological Leadership: Since the principal vulnerability lies in the midstream segment, greater emphasis should be placed on hydrometallurgy, solvent extraction, electrowinning, bioleaching, direct lithium extraction and rare-earth separation technologies.
Achieving self-reliance in battery-grade chemicals, permanent magnets, speciality alloys and high-purity materials will be essential for long-term competitiveness.
India must adopt frontier technologies such as nanomaterials, AI-based resource mapping and quantum mineral separation to overcome mineral-processing constraints and strengthen its global competitiveness.
Strategic Stockpiling and Supply-Chain Intelligence: India should establish a comprehensive framework integrating strategic reserves, critical-mineral intelligence, demand forecasting, supply-chain mapping and early-warning systems.
Such an approach would reduce vulnerabilities arising from geopolitical conflicts, export restrictions, market volatility and logistical disruptions.
Circular Mineral Economy: India must move from the traditional linear model of extraction to a ‘mine‑to‑market‑to‑mine’ framework.
Greater emphasis on urban mining, secondary resource recovery, waste valorisation and closed‑loop manufacturing will strengthen both resource security and sustainability.
Countries like Japan, with its rare‑earth recycling from discarded electronics, and the European Union’s Raw Materials Alliance, which promotes circular mineral economies, provide models India can adapt to its growing e‑waste ecosystem.
Research and Commercialisation Ecosystem: Future competitiveness will depend upon the rapid conversion of scientific research into commercial applications.
Stronger linkages among academia, industry and research institutions should therefore promote advances in nanotechnology, green chemistry, materials engineering, mineral traceability systems and artificial intelligence-enabled resource management.
Human Capital and Global Value Chains: India must cultivate a highly skilled workforce in geology, metallurgy, chemical engineering, materials science, data analytics and environmental management.
Simultaneously, India should expand and diversify its participation in global critical-mineral supply chains through friend-shoring, strategic partnerships, overseas resource investments and technology co-development, thereby strengthening long-term resource security and supply-chain resilience.
Sustainability and Responsible Governance: The future critical-mineral ecosystem must be founded upon the principles of resource efficiency, environmental stewardship, community participation, transparency, intergenerational equity and a just transition, ensuring that economic growth and ecological sustainability progress together.

Concluding Insight

As the world transitions from hydrocarbon geopolitics to mineral geopolitics, the true source of power will lie not beneath the ground but across the "mine-to-magnet" ecosystem. In the age of green industrialisation, strategic autonomy, friend-shoring and geoeconomic statecraft, mastering critical-mineral value chains will define the next generation of economic and technological leadership. As António Guterres aptly observed, "A world powered by renewables is a world hungry for critical minerals."

UPSC Prelims Connect

Q1. Consider the following minerals: (2020)

Bentonite
Chromite
Kyanite
Sillimanite

In India, which of the above is/are officially designated as major minerals?

(A) 1 and 2 only

(B) 4 only

(D) 2, 3 and 4 only

Ans: D

Q2. Recently, there has been a concern over the short supply of a group of elements called ‘rare earth metals’. Why? (2012)

China, which is the largest producer of these elements, has imposed some restrictions on their export.
Other than China, Australia, Canada and Chile, these elements are not found in any country.
Rare earth metals are essential for the manufacture of various kinds of electronic items and there is a growing demand for these elements.

Which of the statements given above is/are correct?

(A) 1 only

(B) 2 and 3 only

(D) 1, 2 and 3

Ans: C

UPSC Mains Connect

Q. Despite India being one of the countries of Gondwanaland, its mining industry contributes much less to its Gross Domestic Product (GDP) in percentage. Discuss. (2021)

Q. “In spite of adverse environmental impact, coal mining is still inevitable for development”.Discuss. (2017)

QuestlinkIAS Practice Question

Prelims:

Q. With reference to the Global Critical Minerals Outlook 2026 and India's critical mineral ecosystem, consider the following statements:

The Global Critical Minerals Outlook 2026 has been released by the International Energy Agency (IEA).
The Ministry of Mines has identified 30 critical minerals in India.
The Democratic Republic of Congo contributes approximately 74% of global cobalt production.
The National Critical Mineral Mission (NCMM), launched in 2025, envisages an investment of approximately ₹34,300 crore between 2024–25 and 2030–31.

How many of the statements given above are correct?

(a) Only one

(b) Only two

(d) All four

Ans: (d)

Mains:

Q. Critical minerals have transformed from commodities into instruments of geoeconomic statecraft. Discuss the significance of critical minerals in achieving India's objectives of green industrialisation, technological sovereignty and strategic autonomy. Also examine the major challenges that impede the development of an integrated "mine-to-magnet" ecosystem in India. (250 words)

Source Editorial- Critical minerals, the foundation of strategic power - The Hindu