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Africa’s Role in India’s Critical Mineral Mission
Context:
India’s Critical Minerals Mission’s success hinges on leveraging its partnerships with African nations, which hold 30% of the world’s critical mineral reserves.
Africa’s Role in India’s Critical mineral Supply Chain:
- Significance: Africa holds 30% of global critical mineral reserves.
- India’s Ties: Long Standing political, economic, and historic connections with Africa, supported by a three million-strong diaspora.
- Trade: Mining and mineral sectors account for $43 billion of the $98 billion bilateral trade in 2022-23.
- Energy Collaboration: India sources 15% of its oil demand from Africa and imports natural gas and mineral fuels.
- Opportunities: Africa’s push for value addition (e.g., Tanzania’s processing facilities, Zimbabwe’s raw mineral export bans) aligns with India’s goals.
Challenges India Faces in Developing Critical Mineral Source in Africa and India:
Geopolitical Competition
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- Chinese Dominance: China controls 80% of the Tenke Fungurume mines in the DRC, which produce 12% of the world’s cobalt.
- Chinese Influence in Africa: China’s early investments and control over key resources create economic and security risks for India, making it difficult to secure favourable resource deals.
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Supply Chain Vulnerabilities
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- Import Dependency: As per Ministry of Mines India is highly dependent on imports of critical minerals largely sourced from countries like Chile ,China, Russia, and Australia.
- Lack of Processing Capacity: India depends on foreign, mainly Chinese, processing facilities, limiting its value capture.
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Exploration and Development Challenges
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- Slow Exploration: Despite discoveries like 5.9 million tonnes of lithium in Jammu & Kashmir, extraction is slow due to complex geology and regulatory barriers.
- Infrastructure Gaps: Africa’s underdeveloped mining infrastructure requires significant investment, which may be challenging for India.
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Environmental and Social Concerns
- Environmental Impact:
- India must adopt sustainable practices, such as tailings management and mine rehabilitation, to mitigate environmental effects of Cobalt mining in DRC in an era that threatens to be dominated by the geopolitics of a not-so-green energy transition.
- Community Engagement: Local protests, such as those at the Tenke Fungurume mine in 2021, highlight the need for India’s investments to prioritise community welfare.
Regulatory and Policy Framework
- Navigating Local Regulations: Africa’s diverse regulatory environments complicate investments and operations.
- For example, Zambia’s 2019 mining tax reforms caused a 30% drop in copper production. India must work with local experts to ensure regulatory compliance.
Steps taken by Indian Government to develop Critical Mineral Industry:
- Launched: Critical Mineral Mission aims to expand domestic production, prioritise recycling, and incentivise overseas asset acquisition.
- Legislative Changes: Mines and Minerals (Development and Regulation) Amendment Bill, 2023 allows private sector exploration of six minerals.
- Overseas Acquisitions: KABIL, a joint venture of public sector firms, signed its first lithium mining deal in Argentina in January 2024.
- International Collaborations:
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- India has joined the Mineral Security Partnership (MSP), led by the United States of America.
- This partnership aims to enhance cooperation in securing the supply chain of critical minerals for the member countries by facilitating investment in identified blocks of these minerals in resource rich countries.
- Additionally, India is collaborating with countries like Australia, Chile, Argentina, and Bolivia to secure access to critical mineral resources.
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- Customs Duty Exemptions:
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- In the Union Budget 2024-25 ,the Indian government has removed customs duties on 25 critical minerals, to promote domestic manufacturing and reduce import dependency.
- The Ministry of Mines formed a committee to identify critical minerals and proposed a “Centre of Excellence on Critical Minerals” (CECM) to update the list every three years. Of 30 critical minerals identified, 24 are included in the MMDR Act.
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- S&T-PRISM Initiative for Critical Mineral Extraction
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- The Ministry of Mines, under its ‘Science and Technology Programme,’ offers grants to promote research and innovation in start-ups and MSMEs within the mining, mineral processing, metallurgy, and recycling sectors.
- A key focus of the S&T-PRISM initiative is the extraction of strategic and critical minerals at the elemental level, supporting India’s efforts in securing essential resources for its growing technological and industrial needs.
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Collaboration Opportunities for India in Africa:
- Existing Infrastructure Projects: India has completed various projects in 43 African countries, including transmission lines, hospitals, and railway lines.
- Strategic Mining Partnerships: India has signed MoUs with Zambia and Zimbabwe for geological mapping, capacity building, and mineral deposit modelling.
- Skill Development: India’s ITEC program trained 40,000 Africans in 10 years, aiding in workforce development.
- Technology Start-ups: Indian start-ups offer mining exploration, extraction tools, and ecological impact minimization technologies, aligning with Africa’s value-addition goals.
Book Review: Cobalt Red: How the Blood of the Congo Powers Our Lives by Siddharth Kara
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- Siddharth Kara’s Cobalt Red delves into the cobalt mining industry in the Democratic Republic of the Congo (DRC), exposing the human, environmental, and ethical costs tied to the global demand for cobalt, a key component in lithium-ion batteries.
- Kara’s investigation reveals that over two-thirds of the world’s cobalt is mined in the DRC under hazardous conditions.
- Katanga is depicted as the epicentre of cobalt production, often referred to as “the new heart of darkness.”The book reveals the complex and decentralised organisation of cobalt mining in Katanga, where numerous actors are involved in the supply chain.
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Key Themes
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- Human Exploitation: The book highlights the exploitation of Congolese miners, especially children, working in dangerous environments.
- Corporate Accountability: Kara critiques multinational companies profiting from cobalt while ignoring labour abuses in their supply chains.
- Historical Context: The legacy of colonial exploitation continues to affect the DRC, as foreign interests benefit from its mineral wealth.
- Environmental Impact: Unregulated mining has caused significant environmental harm in the region.
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The themes in Cobalt Red align with India’s Critical Mineral Mission, aimed at securing essential minerals like cobalt for its technological and economic growth.
- Investment Opportunities: As India expands its presence in Africa, it can prioritise ethical practices and community engagement, ensuring sustainable partnerships that benefit local populations.
- Corporate Responsibility: Indian companies can adopt lessons from Cobalt Red to avoid perpetuating exploitation in Africa’s mining industry, emphasising ethical labour practices.
- Advocacy for Ethical Sourcing: India’s policy framework can champion ethical sourcing, aligning with global sustainability goals and supporting African communities.
