From The Economic Times · Shireen Hajra · · 2m
India critical minerals: From rocks to riches
India's critical minerals strategy faces gaps in refining despite resource potential.
In brief
India's critical minerals strategy faces gaps in refining despite resource potential. India's critical minerals strategy aims to reduce import dependence but faces midstream processing gaps in magnet, lithium and graphite production. Originally reported by The Economic Times.
China tightens rare-earth exports
In April 2025, Chinese exports of rare-earth products disrupted Indian automakers and component manufacturers.
“China began tightening exports of certain rare-earth products”
India's critical minerals vulnerability
India relies on imports for lithium, cobalt and nickel while 93% of copper ore needs come from overseas.
“Ministry of Mines data show that India relied entirely on imports for lithium, cobalt and nickel in FY23”
China dominates permanent-magnet imports
China supplied 60-80% of India's permanent-magnet imports by value and 85-90% by quantity between 2022 and 2025.
“A Press Information Bureau (PIB) release said that between 2022 and 2025, China supplied nearly 60-80% of India's permanent-magnet imports by value”
India's critical mineral strategy
India's critical-mineral strategy must integrate geological discovery, resource assessment, mining, processing and value-added manufacturing.
“Pradeep Singh, Additional Director General, Policy Support System, Geological Survey of India, told ET Online that India’s critical-mineral strategy must be viewed as an integrated effort spanning geological discovery, resource assessment, mining, beneficiation, processing, recycling and value-added manufacturing”
Critical mineral import sources
Finland supplied 60% of cobalt oxide imports, Ireland 40% of lithium carbonate, Chile 41% of lithium oxide and 40% of copper ore imports.
“Finland supplied nearly 60% of India's cobalt oxide and hydroxide imports in FY25”
India's critical mineral exploration
GSI has identified 482.6 million tonnes of rare-earth ore resources across 34 exploration projects.
“The GSI has identified 482.6 million tonnes of rare-earth ore resources across 34 exploration projects”
Beach-sand resources limitation
Approximately 482-million-tonne estimate is largely attributable to beach-sand resources and does not establish commercial viability.
“Singh cautioned that the approximately 482-million-tonne estimate is largely attributable to beach-sand resources and does not establish how much material is commercially viable”
Deloitte's midstream constraints
Deloitte identifies three gaps: lithium production, rare-earth extraction and battery-grade graphite.
“Deloitte’s analysis identifies midstream processing, refining and conversion into high-purity materials as one of the binding constraints in India’s critical-mineral value chain”
Lithium production gap
India has strong research but little proven large-scale capacity to make battery-grade lithium carbonate and hydroxide.
“The first is lithium: India has strong research, but little proven large-scale capacity to make battery-grade lithium carbonate and hydroxide”
Rare-earth extraction gap
State-run IREL runs a rare-earth extraction plant in Odisha and a refining unit at Aluva but lacks industrial-scale magnet production.
“state-run IREL already runs a rare-earth extraction plant in Odisha and a refining unit at Aluva in Kerala, but the missing link is industrial-scale conversion of separated oxides into metals, alloys and finished magnets”
Graphite production gap
Battery-grade graphite needs stricter purity and particle control than mining alone provides.
“The third is battery-grade graphite, which he said needs far stricter purity and particle control than mining alone provides”
National Critical Mineral Mission
The mission targets 1,200 exploration projects, self-sufficiency in processing five critical minerals, 1,000 patents and four regional processing parks by FY31.
“The centrepiece of this effort is the National Critical Mineral Mission. Its targets include 1,200 domestic exploration projects, self-sufficiency in processing at least five critical minerals, 1,000 patents and four regional processing parks by FY31”
Magnet production push
A ₹7,280 crore scheme aims to build 6,000 tonnes a year of integrated magnet capacity with sales-linked incentives.
“A ₹7,280 crore scheme approved in November 2025 aims to build 6,000 tonnes a year of integrated magnet capacity, with ₹6,450 crore in sales-linked incentives and a ₹750 crore capital subsidy”
Recycling capacity expansion
A ₹1,500 crore scheme aims to build 270 kilotonnes of annual recycling capacity for critical minerals.
“A ₹1,500 crore scheme approved in September 2025 aims to build at least 270 kilotonnes of annual recycling capacity, yielding around 40 kilotonnes of critical minerals”
What it means
India's critical minerals strategy aims to reduce import dependence but faces midstream processing gaps in magnet, lithium and graphite production.
