Central Idea

The Centre is auctioning twenty blocks of critical minerals for commercial mining by the private sector.
These blocks contain lithium ore and 10 of the 30 minerals declared as “critical” by the government in July.

What are Critical Minerals?

Critical minerals are elements that are crucial to modern-day technologies and are at risk of supply chain disruptions.
These minerals are used in making mobile phones, computers, batteries, electric vehicles, and green technologies like solar panels and wind turbines.
Minerals such as antimony, cobalt, gallium, graphite, lithium, nickel, niobium, and strontium are among the 22 assessed to be critical for India.
Many of these are required to meet the manufacturing needs of green technologies, high-tech equipment, aviation, and national defence.
List of critical minerals includes:

Identified Minerals: The assessment resulted in a list of 30 critical minerals, including antimony, beryllium, cobalt, copper, lithium, nickel, rare earth elements, silicon, tin, titanium, tungsten, and others.
Fertilizer Minerals: Two minerals critical for fertilizer production, phosphorous and potash, are also included.

First Instance: This auction marks the first time that rights for lithium ore mining are being offered to private parties in India.
Other Critical Minerals: The blocks also include nickel, copper, molybdenum, and rare earth elements (REEs), crucial for various industries.

Distribution: The 20 blocks are spread across eight states, including Tamil Nadu, Odisha, Bihar, Uttar Pradesh, Gujarat, Jharkhand, Chhattisgarh, and Jammu & Kashmir.
Types of Licenses: Four blocks are for a Mining License (ML), allowing immediate mining post-clearance. The remaining 16 blocks are for a Composite License (CL), permitting further exploration before potentially converting to an ML.
Approvals Required: Licensees must obtain various approvals, including forest clearance and environmental clearance.
Forest Land: Approximately 17% of the total concession area, or 1,234 hectares, is forest land.

Lithium Reserves: The two lithium reserve blocks, one each in J&K and Chhattisgarh, are auctioned for CL.
Nickel and Copper Reserves: Nickel ore reserves are found in Bihar, Gujarat, and Odisha, with the Odisha block also containing copper reserves.

Lithium Imports: In FY23, India imported 2,145 tonnes of lithium carbonate and lithium oxide, costing Rs 732 crore.
Nickel and Copper Imports: The country imported 32,000 tonnes of unwrought nickel and 1.2 million tonnes of copper ore, costing Rs 6,549 crore and Rs 27,374 crore, respectively.
Import Dependence: India relies entirely on imports for lithium and nickel, and 93% for copper.

Future Auctions: A second tranche of critical mineral blocks, including new lithium reserves in Rajasthan and Jharkhand, is expected.
Geological Surveys: The Geological Survey of India is conducting 125 projects to explore critical mineral reserves.
Centre of Excellence: A recommendation to establish a Centre of Excellence for Critical Minerals aims to develop a complete value chain in the country.

The auction of critical mineral blocks is a significant step towards reducing India’s reliance on imported minerals, particularly lithium, nickel, and copper.
This initiative aligns with the #AatmanirbharBharat vision and is expected to bolster India’s position in vital industries like battery manufacturing and electric vehicles.
The success of these auctions will be crucial in shaping India’s resource independence and industrial future.