Note4Students
From UPSC perspective, the following things are important :
Prelims level: Lithium ion battery
Mains level: Paper 3- Adoption of e-vehicles and challenges
Article highlight India’s preparedness for the faster adoption of electric vehicles and steps taken by the government in this direction.
Why electric mobility matters for India
- It is important for India because such vehicles are sustainable and profitable in the long term.
- Reducing dependence on crude oil will save the government money, reduce carbon emissions, and build domestic energy independence.
- India’s transition to electric vehicles will allow us to fine-tune our infrastructure.
- This will also influence India’s foreign policy as our energy security dependence will shift from West Asia to Latin America.
- India imported 228.6 MT of crude oil worth $120 billion in 2018–19, which made it the third-largest oil importer in the world in terms of value.
Government policies
- Under the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles and its updated (Fame 2) version, the government has allocated $1.3 billion in incentives.
- A proposal for a $4.6 billion subsidy for battery makers has also been proposed by the NITI Aayog.
- These policies are embedded with the vision to have 30% electric vehicles plying the roads by 2030.
Developing domestic battery manufacturing capacity
- At present, India’s lithium-ion battery demand is fulfilled by imports from China, Vietnam, and Hong Kong.
- In the last two years, India’s lithium imports have tripled from $384 mn to $1.2 bn.
- With its policy intervention to support battery manufacturers by supplying lithium and cobalt, this industry is more likely to grow domestically to support India’s goal to switch to electric mobility.
- In 2019, NALCO, Hindustan Copper Limited (HCL) and Mineral Exploration Corporation Ltd (MECL) formally signed a joint venture agreement to form Khanij Bidesh India Limited (KABIL) to scout for strategic mineral assets like lithium and cobalt abroad for commercial use and for supplying to meet the domestic requirement for battery manufacturers.
- Developing domestic battery manufacturing capacity may fundamentally change India’s relationship with resource-rich Latin America as the government plans to buy overseas lithium reserves.
- In Latin America, most of the production comes from Argentina, Chile, and Bolivia which holds about 80% of the explored lithium of the world.
- Currently, India’s biggest trading partners in Latin America are Brazil, Mexico, and Venezuela, and majority of trade is concentrated on crude oil which includes 14%-20% of India’s total crude oil imports.
- This may soon shift to lithium and cobalt.
Conclusion
The Indian government’s initiation to take the front seat in electric mobility and preemptive action to send a high-level delegation to have a precise understanding of the availability of lithium and possibilities of joint ventures will supply domestic markets and drive international markets.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: Marginal propensity to consume
Mains level: Paper 3- Economic recovery and India's New Deal Moment
The article explains the opportunity presented by the budget to steer the economy out of the uncertain territory.
3 characteristics of India’s economic recovery
- First, India has broken the link between virus proliferation and mobility earlier and more successfully than many countries.
- Second, the employment rate gradually improved till September but has weakened since then, even as the economy has progressively opened up.
- CMIE’s labour market survey still reveals 18 million fewer employed (about 5 per cent of the total employed) compared to pre-pandemic levels.
- A third phenomenon is large firms have endured the crisis better and are gaining market share at the expense of smaller firms.
- To the extent there is a migration of activity from the informal/SME firms to larger firms, tax collections and Sensex/Nifty earnings should get a boost, even holding the economic pie constant.
- Greater scale and formalisation undoubtedly augur well for medium-term productivity but could increase near-term labour market frictions and boost pricing power.
Increased prospects of K-shaped recovery
- Above 3 factors increases prospects of a K-shaped recovery from COVID, a phenomenon playing out globally.
- Households at the top of the pyramid are likely to have seen their incomes largely protected, and savings rates increased.
- Meanwhile, households at the bottom are likely to have witnessed permanent hits to jobs and incomes.
3 Implications of K-shaped recovery
- 1) What we are currently witnessing is pent-up demand from the upper-income households.
- However, households at the bottom have experienced a permanent loss of income in the forms of jobs and wage cuts, this will be a recurring drag on demand, if the labour market does not heal faster.
- 2) To the extent that COVID has triggered an effective income transfer from the poor to the rich, this will be demand-impeding in the steady state.
- This is explianed by the fact that marginal propensity to consume at the bottom is higher than that at the top, just as the marginal propensity to import at the top is higher than at the bottom.
- 3) If COVID-19 reduces competition or increases the inequality of incomes and opportunities, it could impinge on trend growth in developing economies by hurting productivity and tightening political economy constraints.
Factors that need to be considered to decide the policy response
- Policy need to look beyond the next few quarters and anticipate the state of the macro economy post this expression of pent-up demand.
- The key factor is wheather private sector starts re-investing and re-hiring.
- With manufacturing utilisation rates below 70 per cent pre-COVID, an investment revival, in turn, will depend crucially on the
- Exports should benefit from strengthening global growth as the world gets progressively vaccinated and more US fiscal stimulus.
Upcoming budget: India’s New Deal moment
- It’s against this backdrop that the upcoming budget presents India with its New Deal moment.
- Given the prevailing demand uncertainties, the budget represents an opportune moment for the Centre, in conjunction with the states, to embark on a large physical and social infrastructure push.
- This will simultaneously boost near-term aggregate demand, crowd in private investment, create jobs to soak up the unemployed, and improve the economy’s external competitiveness.
- Job creation, health and education, in turn, will be a start to help mitigate COVID-induced inequalities.
How to finance the investment?
- Gradual near-term consolidation coupled with a credible medium-term fiscal plan will be key to anchoring the bond market and underscoring an adherence to macro stability.
- How then can public investment increase meaningfully if the headline deficit (projected above 11 per cent of GDP) must come down?
- Public investment could be increased only if the public investment push is financed by aggressive asset sales-strategic sales, disinvestment, land and infrastructure monetisation.
- In this manner, expenditure to GDP can actually rise next year — generating an expansionary fiscal impulse to the economy — while automatic stabilisers are used to reduce the headline fiscal deficit.
Conclusion
India’s faster-than-expected rebound is very encouraging. But given labour market pressures and prospects of a K-shaped recovery around the world, the economy will need to be carefully nurtured and stoked. The budget presents a crucial opportunity to make a big down payment towards this end.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: Taper tantrum
Mains level: Paper 3- Challenges ahead for the RBI in withdrawing expansionary policy measures
With the Indian economy showing green shoots, RBI has to face some fundamental challenges while withdrawing the expansionary measures.
Expansionary policy as a response to pandemic
- To manage the financial pressures unleashed by COVID-19, the RBI unleashed several measures.
- It reduced policy interest rates aggressively.
- It released an unprecedented amount of liquidity in the market.
- It instituted a slew of measures for targeted assistance to, especially distressed sectors.
Time to roll back the expansionary monetary policy
- As the Indian economy is showing the signs of recovery, the RBI must be planning for a non-disruptive exit out of the easy money regime.
- Reversing a crisis-driven expansionary policy has to be a deliberative process, with the timing and sequencing carefully planned.
- A big lesson of the global financial crisis is that any missteps on the exit path by way of commission, omission, or importantly communication, can be costly in macroeconomic terms.
Challenges RBI will face on the way out of expansionary monetary policy
1) Restraining inflation while supporting the recovery
- Inflation remained above the RBI’s target band for the past several months.
- According to the RBI’s own estimates, inflation is expected to remain above the band for the next several months.
- Yet, the MPC, in its recent review, decided against any rate action out of concerns for growth and financial stability.
- The MPC expects inflation to soften on its own in the weeks ahead.
- That outcome is not inevitable.
- Inflation could be pressured upwards by several factors even though there could be some apparent softening purely because of base effects.
- There is the risk that persistent high inflation expectations would result in food inflation getting more generalised.
- Core inflation could firm up because of rising input prices.
- ‘Excessive margins’, among the factors cited by the MPC as one of the causes of high inflation, may not disappear.
- Equally, there are concerns that the recovery, for all the positive signals, is still fragile.
- And there is heightened concern about an aggravated unemployment problem caused by big firms retrenching labour to cut costs.
2) Impact on savings
- RBI should also be concerned about the plight of savers who are being shortchanged by low-interest rates at a time of high inflation.
- Low-interest rates, its impact on inflation and economic recovery taken together make a complex cocktail of dilemmas for the RBI as it seeks to normalise the policy rates.
3) Withdraw excess liquidity at right time and to avoid ‘taper tantrum’
- Another related challenge will be to withdraw the ‘excess’ liquidity in good time.
- Banks are routinely depositing trillions of rupees with the RBI every day, evidencing that all the money that the central bank injected into the system is not doing much good anymore.
- Every financial crisis can be traced back to mispricing of risk.
- Mispricing of risk results when there is too much liquidity sloshing around the system for too long.
- It will drive investors into dodgy ventures and threaten financial stability.
- As the RBI seeks to guard financial stability by normalising liquidity, it will have to contend with possible market tantrums.
- The lesson from the taper tantrums in the U.S. is that the RBI will have to manage its communication as carefully as it does the liquidity withdrawal.
4) Stability of the rupee
- Next challenge for the RBI will be to restrain the rupee from appreciating out of line with fundamentals.
- Here, the RBI is confronted with a classic case of ‘the impossible trinity’.
- The impossible trinity deals with allowing free capital flows while simultaneously maintaining a stable exchange rate and restraining inflation.
- The current account surplus this year together with massive capital flows has meant an excess of dollars in the system putting upward pressure on already overvalued rupee.
- The RBI has absorbed nearly $90 billion this fiscal year to prevent exchange rate appreciation and to maintain the competitiveness of the rupee.
- The RBI’s ability to continue to intervene in the forex market will be constrained by its anxiety about how the resultant liquidity might aggravate inflation and the risk to financial stability.
Consider the question “What are the challenges ahead for the RBI while winding down the expansionary monetary policy measures that were announced to deal with the economic disruption of caused due to pandemic and subsequent lockdown.
Conclusion
It is better to be rough right, as Keynes said, than be precisely wrong. That should be the guiding principle for RBI as it navigates its way out of the crisis driven easy money policy.
Back2Basics: What is taper tantrum?
- Taper tantrum refers to the 2013 collective reactionary panic that triggered a spike in U.S. Treasury yields, after investors learned that the Federal Reserve was slowly putting the breaks on its quantitative easing (QE) program.
- The Fed announced that it would be reducing the pace of its purchases of Treasury bonds, to reduce the amount of money it was feeding into the economy.
- The ensuing rise in bond yields in reaction to the announcement was referred to as a taper tantrum in financial media.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: Quantum Technology
Mains level: NM-QTA
The detailed project report for a National Mission on Quantum Technology and Applications (NM-QTA) has been drawn out and finalised.
Q.Discuss various applications of quantum technology for strategic and economic development.
Story so far
- In last year’s budget session, it was proposed that ₹8,000 crores be set aside to develop quantum science and technology.
- The detailed project report is now ready and in the next couple of months, this mission might get approval.
- Recognising the importance of quantum technology, the Department of Science and Technology has also initiated a programme called QuEST to explore the possibilities and engage with the researchers.
About NM-QTA
- The mission will function under the Department of Science & Technology (DST).
- It will be able to address the ever-increasing technological requirements of society and take into account the international technology trends.
- The mission will help prepare next-generation skilled manpower, boost translational research and also encourage entrepreneurship and start-up ecosystem development.
Why need such a mission?
- Quantum technologies are rapidly developing globally with hugely disruptive potential.
- The range of quantum technologies is expected to be one of the major technology disruptions that will change the entire paradigm of computation, communication and encryption.
- It is perceived that the countries who achieve an edge in this emerging field will have a greater advantage in garnering multifold economic growth and dominant leadership role.
- It has become imperative both for government and industries to be prepared to develop these emerging and disruptive changes.
- It will establish standards to be applied to all research and help stimulate a pipeline to support research and applications well into the future.
Recent applications
- Recently, DRDO has successfully demonstrated communication between its two labs using Quantum Key Distribution (QKD) technology.
- In June 2020, China demonstrated quantum communication technology using the satellite Micius, by conducting a secret conference between two ground stations about 1,120 km apart.
- They used the satellite not to transmit the entire communication, but to simultaneously send a pair of secret keys to the two ground stations.
- Other potential applications include secure communication, fast computers that established quantum supremacy, sensors and quantum-inspired devices.
Back2Basics: Quantum Technology
- Quantum Technology is based on the principles of quantum theory, which explains the nature of energy and matter on the atomic and subatomic level.
- It concerns the control and manipulation of quantum systems, with the goal of achieving information processing beyond the limits of the classical world.
- Its principles will be used for engineering solutions to extremely complex problems in computing, communications, sensing, chemistry, cryptography, imaging and mechanics.
- This key ability makes quantum computers extremely powerful compared to conventional computers when solving certain kinds of problems like finding prime factors of large numbers and searching for large databases.
What is Quantum Mechanics?
- It is a fundamental theory in physics which describes nature at the smallest – including atomic and subatomic – scales.
- At the scale of atoms and electrons, many of the equations of classical mechanics, which describe how things move at everyday sizes and speeds, cease to be useful.
- In classical mechanics, objects exist in a specific place at a specific time.
- However, in quantum mechanics, objects instead exist in a haze of probability; they have a certain chance of being at point A, another chance of being at point B and so on.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: PIDF Scheme
Mains level: Digital banking facilitation measures
The RBI has announced operational guidelines to create digital payments acceptance infrastructure across Tier III to Tier VI regions in India.
Possible prelims question:
Q. Which of the following is the major aim of Payments Infrastructure Development Fund (PIDF) recently created by the Reserve Bank of India (RBI)?
a) Promotion of UPI payments
b) Deploying Points of Sale (PoS) infrastructure
c) Creation of digital wallets
d) All of the above
PIDF Scheme
- The scheme was first announced in June last year to encourage fintech companies and banks to deploy point of sale (PoS) infrastructure across the country to improve the penetration of card-based and other digital payments.
- The primary beneficiaries will be merchants providing essential services, such as transport and hospitality, government payments, fuel pumps, healthcare facilities, and groceries.
- Amid the rapid rise in the volume of payments through the UPI network, the RBI is taking steps to further widen the use of digital payments in the country.
- The fund will be operational for three years from January 1, 2021, and would help subsidise banks and non-banks for the deployment of payments, subject to them achieving specific targets.
Why need PIDF?
- Over the years, the payments ecosystem in the country has evolved with a wide range of options such as bank accounts, mobile phones, cards, etc.
- To provide further fillip to the digitization of payment systems, it is necessary to give impetus to acceptance infrastructure across the country, more so in under-served areas.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: Various graphs of economic recovery
Mains level: Economic recovery amid coronavirus pandemic
The prospects of a K-shaped economic recovery from COVID are increasing both in India and across the world.
What is K-Shaped Recovery?
- A K-shaped recovery occurs when, following a recession, different parts of the economy recover at different rates, times, or magnitudes.
- This is in contrast to an even, uniform recovery across sectors, industries, or groups of people.
- A K-shaped recovery leads to changes in the structure of the economy or the broader society as economic outcomes and relations are fundamentally changed before and after the recession.
- This type of recovery is called K-shaped because the path of different parts of the economy when charted together may diverge, resembling the two arms of the Roman letter “K.”
Try these PYQs:
Q.Economic growth in country X will necessarily have to occur if
(a) There is technical progress in the world economy
(b) There is population growth in X
(c) There is capital formation in X
(d) The volume of trade grows in the world economy
Q. Economic growth is usually coupled with
(a) Deflation
(b) Inflation
(c) Stagflation
(d) Hyperinflation
3 characteristics of India’s economic recovery
- First, India has broken the link between virus proliferation and mobility earlier and more successfully than many countries.
- Second, the employment rate gradually improved till September but has weakened since then, even as the economy has progressively opened up.
- CMIE’s labour market survey still reveals 18 million fewer employed (about 5 per cent of the total employed) compared to pre-pandemic levels.
- A third phenomenon is large firms have endured the crisis better and are gaining market share at the expense of smaller firms.
- To the extent there is a migration of activity from the informal/SME firms to larger firms, tax collections and Sensex/Nifty earnings should get a boost, even holding the economic pie constant.
- Greater scale and formalisation undoubtedly augur well for medium-term productivity but could increase near-term labour market frictions and boost pricing power.
Increased prospects of K-shaped recovery
- Above 3 factors increases prospects of a K-shaped recovery from COVID, a phenomenon playing out globally.
- Households at the top of the pyramid are likely to have seen their incomes largely protected, and savings rates increased.
- Meanwhile, households at the bottom are likely to have witnessed permanent hits to jobs and incomes.
3 Implications of K-shaped recovery
- 1) What we are currently witnessing is pent-up demand from the upper-income households.
- However, households at the bottom have experienced a permanent loss of income in the forms of jobs and wage cuts, this will be a recurring drag on demand, if the labour market does not heal faster.
- 2) To the extent that COVID has triggered an effective income transfer from the poor to the rich, this will be demand-impeding in the steady state.
- This is explained by the fact that marginal propensity to consume at the bottom is higher than that at the top, just as the marginal propensity to import at the top is higher than at the bottom.
- 3) If COVID-19 reduces competition or increases the inequality of incomes and opportunities, it could impinge on trend growth in developing economies by hurting productivity and tightening political economy constraints.
Factors that need to be considered to decide the policy response
- Policy need to look beyond the next few quarters and anticipate the state of the macro economy post this expression of pent-up demand.
- The key factor is whether private sector starts re-investing and re-hiring.
- With manufacturing utilisation rates below 70 per cent pre-COVID, an investment revival, in turn, will depend crucially on the demand dynamics
- Exports should benefit from strengthening global growth as the world gets progressively vaccinated and more US fiscal stimulus.
Upcoming budget: India’s New Deal moment
- It’s against this backdrop that the upcoming budget presents India with its New Deal moment.
- Given the prevailing demand uncertainties, the budget represents an opportune moment for the Centre, in conjunction with the states, to embark on a large physical and social infrastructure push.
- This will simultaneously boost near-term aggregate demand, crowd in private investment, create jobs to soak up the unemployed, and improve the economy’s external competitiveness.
- Job creation, health and education, in turn, will be a start to help mitigate COVID-induced inequalities.
How to finance the investment?
- Gradual near-term consolidation coupled with a credible medium-term fiscal plan will be key to anchoring the bond market and underscoring an adherence to macro stability.
- How then can public investment increase meaningfully if the headline deficit (projected above 11 per cent of GDP) must come down?
- Public investment could be increased only if the public investment push is financed by aggressive asset sales-strategic sales, disinvestment, land and infrastructure monetisation.
- In this manner, expenditure to GDP can actually rise next year — generating an expansionary fiscal impulse to the economy — while automatic stabilisers are used to reduce the headline fiscal deficit.
Conclusion
India’s faster-than-expected rebound is very encouraging. But given labour market pressures and prospects of a K-shaped recovery around the world, the economy will need to be carefully nurtured and stoked. The budget presents a crucial opportunity to make a big down payment towards this end.
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: Black Holes, Recoils
Mains level: Black holes and gravitation waves
A supermassive black hole, which is estimated to weigh up to 100 billion times the mass of the Sun, is seemingly missing, leaving astronomers perplexed.
Try this PYQ:
Q.Recently, scientists observed the merger of giant ‘blackholes’ billions of light-years away from the Earth. What is the significance of this observation?
(a) ‘Higgs boson particles’ were detected.
(b) ‘Gravitational waves’ were detected.
(c) Possibility of inter-galactic space travel through ‘wormhole’ was confirmed.
(d) It enabled scientists to understand ‘singularity’.
The ‘missing’ black hole
- The black hole is supposed to be located in Abell 2261, an enormous galaxy cluster that is about 2.7 billion light-years away from our planet.
- So, when we look at a celestial object, we are looking at how it appeared that long ago in the past.
- At 2.7 billion light-years away, the Abell galaxy is at an overwhelmingly large distance away from us.
What could have happened?
- Every large galaxy in the universe has a supermassive black hole at its centre, whose mass is millions or billions of times that of the Sun, says NASA.
- The black hole at the centre of our galaxy– the Milky Way– is called Sagittarius A*, and is 26,000 light-years away from Earth.
- Scientists have been using data gathered in 1999 and 2004 to look for the centre of the Abell galaxy, but have so far been unable to find its black hole.
- A reason for this could be that Abell’s black hole has been ejected from the centre of the galaxy.
Recoil of Black Holes
- When two black holes merge, they release what is known as gravitational waves– invisible ripples travelling at the speed of light, which squeeze and stretch anything in their path.
- As per the theory of gravitational waves, during such a merger, when the amount of waves generated in one direction is stronger than another, the new big black hole can be sent away from the centre of the galaxy into the opposite direction.
- This is known as a “recoiling” black hole.
- So far, though, scientists are yet to find definitive evidence for recoiling black holes and are still to discover whether supermassive black holes can merge and release gravitational waves.
- As of now, only mergers of significantly smaller black holes have been verified.
Why it is significant?
- The researchers assert that this may have happened because of the merging of two smaller galaxies to form Abell– a process in which both of their black holes merged to form an even bigger black hole.
- If this hypothesis turns out to be true, it would mean a major breakthrough in astronomy.
Back2Basics:
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: Meteor terminology
Mains level: Study of asteroids and meteors
An asteroid which made its landfall in Mukundpura village near Jaipur has been named after the same village and is under the study of Geological Survey of India, Kolkata.
Try this question from CSP 2014:
Q.What is a coma, in the content of astronomy?
(a) Bright half of material on the comet
(b) Long tail of dust
(c) Two asteroids orbiting each other
(d) Two planets orbiting each other
Mukundpura CM2
- The meteorite named Mukundpura CM2 was classified to be a carbonaceous chondrite.
- This is a type of stony meteorite, considered the most primitive meteorite and a remnant of the first solid bodies to accrete in the solar system.
- The composition of carbonaceous chondrites is also similar to the Sun.
- Chondrites are silicate-droplet-bearing meteorites, and this Mukundpura chondrite is the fifth carbonaceous meteorite known to fall in India.
Why it is important to study meteorites?
- Meteorites are representative of asteroids.
- Asteroids are the remnant debris of the inner solar system formation process and thus offer the formation history or the building blocks of the planets.
- Therefore, by studying meteorites in the laboratory and asteroids by exploration and sample return mission we try to reconstruct the activity of early solar system events.
- Also, asteroids are often rich in volatiles and other minerals and can be exploited for future planetary exploration.
Do you know?
Meteorites are broadly classified into three groups – stony (silicate-rich), iron (Fe–Ni alloy), and stony-iron (mixed silicate–iron alloy).
Details of its study
- The study revealed that Mukundpura CM2 had experienced varying degrees of alteration during the impact.
- Some minerals like forsterite and FeO olivine, calcium aluminium rich inclusion (CAI) minerals escaped alteration.
- Few magnetites, sulphides and calcites were also found.
- Detailed spectroscopic studies revealed that the meteorite had very high (about 90%) phyllosilicate minerals comprising both magnesium and iron.
- Further X-ray studies showed it also had aluminium complexes.
Relevance to asteroids
- The results of the Mukundpura CM2 study are relevant to the surface composition of near-Earth asteroids Ryugu and Bennu.
- In October 2020, NASA’s OSIRIS-REx mission collected samples from Bennu and is expected to return in September 2023.
- Last month, Japan’s Hayabusa-2 mission landed on Earth with samples from Ryugu.
Back2Basics:
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Note4Students
From UPSC perspective, the following things are important :
Prelims level: Lithium ion batteries and their significance
Mains level: Lithium reserves in India
Alongside a move to tap into the global lithium value chain, India has initiated a concerted domestic exploration in Karnataka’s Mandya district.
Lithium reserves in Karnataka
- Preliminary surveys by the Atomic Minerals Directorate for Exploration and Research (AMD), an arm of the Department of Atomic Energy has carried out the exploration.
- AMD is carrying out surface and sub-surface exploration for lithium in potential geological domains of the country.
- Their research has shown the presence of 1,600 tonnes of lithium resources in the igneous rocks of the Marlagalla-Allapatna region of Karnataka’s Mandya district.
Must read:
Global producers of lithium
- Australia and Chile have swapped positions as the world’s leading lithium-producing country over the past decade. In 2019, the world’s Top 5 lithium producers were:
- Australia – 52.9% of global production
- Chile – 21.5%
- China – 9.7%
- Argentina – 8.3%
- Zimbabwe – 2.1%
- The U.S. ranked 7th with 1.2% of the world’s lithium production.
In 2019, the world’s Top 5 lithium reserves by country were:
-
Chile – 55.5% of the world’s total
-
Australia – 18.1%
-
Argentina – 11.0%
-
China – 6.5%
-
U.S. – 4.1%
Why is the exploration significant?
- India currently imports all its lithium needs.
- The find in Mandya is extremely small in quantitative terms, but it marks some initial success in the attempt to domestically mine the silver-white metal by way of hard-rock extraction of the ore.
- The domestic exploration push comes at a time when India has stepped up its economic offensive against China, a major source of lithium-ion energy storage products being imported into the country.
- The Marlagalla-Allapatna area is seen as among the most promising geological domains for potential exploration for lithium and other rare metals.
What lies ahead?
- India is seen as a late mover in attempts to enter the lithium value chain, coming at a time when EVs are predicted to be a sector ripe for disruption.
- 2021 is likely to be an inflexion point for battery technology – with several potential improvements to the li-ion technology, and alternatives to this tried-and-tested formulation in advanced stages of commercialization.
Back2Basic: Li-Ion battery
- Whittingham developed the first functional lithium-ion battery in 1976, Goodenough brought in a major improvement in 1980, while Yoshino made the first practical-use lithium-ion battery in 1985.
- Commercially manufactured lithium-ion batteries, based on what Yoshino had developed, made their first appearance in 1991.
Its’ working
- Batteries convert chemical energy into electricity.
- A battery comprises two electrodes, a positive cathode and a negative anode, which is separated by a liquid chemical, called an electrolyte, which is capable of carrying charged particles.
- The two electrodes are connected through an electrical circuit.
- When the circuit is on, electrons travel from the negative anode towards the positive cathode, thus generating an electric current, while positively charged ions move through the electrolyte.
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