India readies its prospectors as hunt begins for lithium and cobalt mines abroad

• India is scrambling to acquire lithium and cobalt mines abroad, along with other resources, to ensure that it has access to such strategic minerals, with China having already taken a substantial lead in the race, much in the manner that it has done so in oil and gas.

• Lithium and cobalt are critical element in batteries that power mobile phones, laptops and electric vehicles, the centerpiece of future transport solution. The global race for these minerals is intensifying in the wake of the growing use of such vehicles.

• The Indian government has directed three state-owned mineral companies to team up for the task.

• The joint venture partners are National Aluminium Company, Hindustan Copper (HCL) and Mineral Exploration Corp Ltd. It can also invite private sector companies who are interested to participate in it. The proposal is currently with the NITI Aayog, which will conduct due diligence before it can be formalized.

• The venture’s main mandate will be to look for and acquire strategic mineral assets abroad, particularly those in which India is deficient.

• The move – likely to be formalized along the lines of ONGC Videsh, which buys oil and gas assets abroad – will help the country build a strategic reserve of key minerals.

• India has no known sources of lithium and cobalt and access to them in critical to the success of its plan to convert most of its vehicles to electric power in about a decade or so.

• With China well ahead in the pursuit of such minerals, especially in Africa, the public sector units have been tasked to actively scout for and acquire assets on a war footing.

• A similar model was tried out a few years back in the bid for acquiring iron ore assets in Hajigak, Afghanistan, through a consortium of state and private players. However, the project failed to materialize due to security concerns in that region.

• Possible sources of lithium include the Congo in Africa and Latin American countries such as Argentina, Bolivia and Chile – the latter is referred to as the lithium triangle. The Congo is the leading producer of cobalt.

• A spike in demand for lithium has fuelled interest in mining of the metal in countries such as Bolivia, which has one-fourth of the world’s reserves. It has reached out to nations like India for exploration and extraction of the metal and manufacture of value-added product.

• India’s requirement of lithium is expected to be 350,000 tonnes per year according to auto industry estimates, with companies like Suzuki India planning to manufacture lithium-ion batteries in India. A recent Metal Bulletin report said the world’s largest producers of the substance feel a shortage of lithium battery-grade compounds will endure in 2018 and years to come.

• Chinese imports of cobalt from the Congo, the world’s biggest producer of the mineral, was around $1.2 billion in the first nine months of 2017, compared with $3.2 million by India, the second-largest importer, according to a recent Wall Street Journal report. The Congo accounts for nearly 54% of the Word’s cobalt supplies.

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