India’s mineral industry, a titan in global production, is on the cusp of a transformative era. The government’s recent policy shifts and budget allocations signal a strategic pivot towards critical minerals, essential for the burgeoning renewable energy and electric vehicle (EV) sectors. The launch of the National Critical Mineral Mission (NCMM), backed by a substantial ₹34,300 crore investment, is a bold step. This mission, encompassing the entire value chain from exploration to recovery, aims to intensify domestic and offshore exploration and streamline regulatory approvals. This could catalyse a surge in domestic production, reducing reliance on imports and fortifying India’s energy security.
The government’s move to remove import duties on critical minerals and related products is a double-edged sword. While it will bolster domestic manufacturing, it also risks flooding the market with low-quality scrap and waste, a historical trend in global manufacturing. To mitigate this, the government should introduce stringent quality standards linked to specific end-uses. This will ensure that the influx of imports enhances, rather than dilutes, the quality of domestic products.
The budget’s allocation of ₹3,000 crore for exploration and surveying, coupled with the National Mineral Exploration Trust’s (NMET) enhanced funding, is a significant boost. It will accelerate the demand for the metal industry and support the second phase of the Production Linked Incentive (PLI) scheme for the specialty steel sector. However, the industry must not become complacent with these incentives. It should leverage these funds to invest in advanced technologies, improve operational efficiencies, and foster innovation.
The government’s push for public-private partnerships (PPPs) in the sector is a welcome move. By involving private players, extraction can be accelerated, and overall efficiency improved. This is particularly crucial as the demand for critical minerals grows exponentially. However, the industry must ensure that these partnerships are transparent and beneficial to all stakeholders.
The budget’s emphasis on green technologies, water conservation, and carbon emission reduction is a step in the right direction. However, the industry must go beyond mere adoption of these technologies. It should strive for sustainable practices, not just as a regulatory requirement, but as a core business principle. This will not only enhance the industry’s environmental credentials but also create a skilled workforce adept in green mining technologies.
The government’s proposal to create a national mineral critical supply chain is a strategic move. It will ensure domestic sources for essential minerals, supporting EV and battery manufacturing. However, the industry must ensure that this supply chain is resilient and adaptable to global market fluctuations.
The mining industry’s contribution to India’s GDP and employment is significant. However, it also faces challenges in exploration, regulations, and environmental clearances. The government’s policy for the recovery of critical minerals from tailings or byproducts of mining, and the introduction of a state mining index, are steps in the right direction. But the industry must also address these challenges proactively, rather than waiting for policy interventions.
The government’s recent policy shifts and budget allocations are a clear signal of its intent to make India a global leader in the critical minerals sector. However, the industry must rise to the challenge. It must leverage these policy pushes to increase domestic production, secure supply chains, and ensure sustainable practices. This will not only enhance India’s energy security but also position it as a key player in the global green and tech-driven economy. The industry must remember that the future of the sector lies not just in the ground, but also in the policies, technologies, and practices it adopts.
