Esha Lohia | 7 Feb 2025 | India | Clean Energy
In a decisive move to bolster its clean energy ambitions, the Union Cabinet has approved the National Critical Minerals Mission (NCMM). The initiative aims to secure essential minerals—such as lithium, cobalt, and nickel—that are crucial for energy transition, electric vehicles, and emerging clean technologies.
Announced on January 29, the NCMM is designed to address India's heavy reliance on imports amid global supply risks, resource nationalism, and geopolitical tensions. The mission outlines a comprehensive strategy to increase domestic exploration, secure overseas assets, promote recycling, and encourage private sector participation. Plans include launching 1,200 exploration projects and auctioning more than 100 critical mineral blocks by 2031.
The mission carries a financial commitment of Rs. 34,300 crores over seven years. This sum includes Rs. 16,300 crores from government spending and an anticipated Rs. 18,000 crores investment by public sector undertakings and other stakeholders.
Critical minerals are unevenly distributed around the world, with over 55% of each key resource concentrated in just 15 countries. Saurabh Priyadarshi, Mining & Metals Business Advisor at Geoxplorers Consulting Services, highlights challenges such as Indonesia’s export ban on nickel, which has disrupted global supply chains and impacted India's ambitions in EV and battery production. He adds that rising resource nationalism in countries like Argentina and Chile further complicates efforts to secure a stable supply.
The NCMM, first mentioned in the July 2024 budget speech, has gained renewed focus with recent policy measures. In the latest budget address, Union Finance Minister Nirmala Sitharaman stressed the need for mining sector reforms and unveiled policies to recover critical minerals from mining waste. In a significant boost, the government also introduced a basic customs duty exemption on 15 critical minerals, supplementing 25 previously identified in the 2024 budget.
The mission document emphasizes the pivotal role of critical minerals in achieving India’s Net Zero targets and its Nationally Determined Contributions (NDCs). As demand surges for components in electric vehicles, wind and solar power projects, and battery storage systems, the NCMM also focuses on exploring offshore mineral resources—including polymetallic nodules rich in cobalt, rare earth elements, nickel, and manganese—that have recently been offered for auction.
In addition to fast-tracking domestic exploration and mining approvals, the government plans to foster private sector involvement and promote the recovery of critical minerals from unconventional sources such as tailings, fly ash, and red mud. An allocation of Rs. 100 crores has been earmarked for these recovery initiatives.
Recognizing the importance of innovation, the NCMM includes a significant focus on research and development. An investment of Rs. 500 crores is planned by 2031 to support domestic R&D, streamline patent filings for innovators and startups, and enhance coordination among research institutions like CSIR, IITs, and IISc. Additionally, the mission aims to establish Centers of Excellence and develop a strategic reserve of critical minerals, with Rs. 500 crores set aside for this purpose.
Sandeep Pai, Director for Research and Strategy of Energy Transition at Swaniti Global, lauds the mission’s emphasis on R&D as a critical step toward securing India's future in clean technology.
Despite these robust measures, India remains vulnerable to geopolitical tensions and supply chain disruptions. Recent studies by the Institute for Energy Economics and Financial Analysis (IEEFA) reveal that India currently imports 100% of its lithium, cobalt, and nickel, while research by the Takshashila Institution identifies significant dependencies on China for minerals like bismuth, lithium, silicon, titanium, tellurium, and graphite. Mining consultant Hitanshu Kaushal warns that, although Australia possesses rich raw material reserves, its exports are predominantly processed in China—underscoring the need for India to accelerate its exploration and data collection efforts.
The NCMM also proposes strengthening international trade ties through Critical Minerals Partnership Agreements (CMPAs) and incorporating critical minerals chapters in existing trade pacts. India has already taken steps in this direction through initiatives like the Minerals Security Partnership and bilateral agreements with countries such as Australia, Argentina, Chile, and joint ventures with Kazakhstan. The state-run entity KABIL, established in 2019, continues to play a key role in acquiring overseas mineral assets.
Domestically, the Geological Survey of India (GSI) has embarked on 368 exploration projects in the past three years, with nearly 195 projects underway in 2024-25 and 227 more slated for 2025-26. However, previous attempts to auction strategic mineral blocks have faced challenges due to insufficient exploration data—a concern that experts believe the NCMM can address by only advancing projects with robust preliminary data.
With its comprehensive approach to exploration, investment, and regulatory reform, the National Critical Minerals Mission represents a bold step towards reducing India's dependence on imports and ensuring a stable supply chain for critical minerals. As India pushes forward with its clean energy agenda, this mission is poised to play a crucial role in bridging the critical mineral gap and supporting the nation's energy transition goals.
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