India’s Energy Transition Risks Increasing Import Dependence on Critical Minerals, Warns CII-EY Report.

India’s transition to a clean energy economy is underscored by a recent report from the Confederation of Indian Industry (CII) and EY, which highlights a projected significant increase in the demand for critical minerals between 2025 and 2070. The report indicates that as the country expands its renewable energy, electric mobility, battery storage, and modern electricity infrastructure, it will increasingly rely on critical minerals such as lithium, nickel, cobalt, silicon, and rare earth elements. Currently, India is fully dependent on imports for 15 of the 23 critical energy-transition minerals assessed, essentially changing the nature of the country’s energy security concerns from traditional fossil fuels to critical mineral supply chains.

This shift in focus has notable implications for the common citizen and market dynamics. For consumers, increasing reliance on imported critical minerals could lead to higher volatility in prices and potential supply shortages, particularly if geopolitical tensions disrupt trade routes. For businesses, particularly in the sectors poised to benefit directly from renewable technologies—such as automotive and energy production—this poses both opportunities and challenges. The rise in electricity demand, projected to grow rapidly through 2035, will require considerable investments in infrastructure, creating potential job opportunities but also necessitating a reallocation of resources and priorities within industries dependent on these minerals.

Looking ahead, the Indian government, alongside the Reserve Bank of India (RBI), must prioritize strengthening domestic exploration, processing, manufacturing, and recycling capabilities to mitigate vulnerabilities in critical mineral supply chains. The report emphasizes the urgency of diversifying supply chains and expanding domestic production to buy down dependence on imports, particularly from countries with concentrated refining capacities like China. As India aims to achieve its 2047 energy-security goals, strategic investments and policy initiatives will be essential in not only securing the necessary minerals but also fostering innovation and resilience in the energy sector.

Source: The Hindu

(Expert Note: This report was independently prepared by the Wealthova Economy team.)