Context: The Central government has recently launched India’s first-ever tranche of e-auction for mineral blocks in the offshore areas of India.
Relevance of the Topic: Prelims- Facts about Critical Minerals, Offshore Mining Initiative, MMDR Act.
Major Highlights of Offshore Mining Initiative:
- First Tranche of E-Auction: Includes 13 mineral blocks in the Arabian Sea and Andaman Sea, comprising of construction sand, lime-mud and polymetallic nodules and crusts.
- Offshore Mining Areas include: Territorial waters, continental shelf, exclusive economic zone (EEZ) and other maritime zones under India's jurisdiction.
- Objectives:
- Reduce import dependence of critical minerals.
- Increase the availability of mineral resources through offshore explorations.
- Enhance the domestic capability to adopt sustainable mining practices.
- The development and regulation of offshore mineral resources in India is governed by the Offshore Areas Mineral (Development and Regulation) Act, 2002.
- Challenges in Offshore Mining:
- Higher operational costs and technical challenges.
- Environmental risks
- Marine habitat destruction
- Disruption in ocean carbon cycling and storage.
What are Critical Minerals?
- Critical mineral are metallic or non-metallic elements that are:
- Essential for modern technologies, economy and national security, such as electronics, renewable energy, and defense.
- Subject to distrution of supply chain, often due to limited reserves, geopolitical issues, or complex processing.
Utility of Critical Minerals:
- Renewable Energy sector: Graphite, Lithium, Cobalt, and Nickel are key components of batteries for electric vehicles (EVs).
- Defense and Aerospace: Tungsten, molybdenum, and REEs are used in advanced weaponry, satellites, and aircraft.
- High-Tech Manufacturing: REEs, Indium, and Gallium are used in electronics, semiconductors, and renewable technologies.
- Agriculture: Fertiliser minerals like potash and phosphate.
Critical Minerals in India:
- Different countries create their own lists of critical minerals based on their individual needs and strategic considerations. In 2023, the Ministry of Mines classified 30 minerals as critical minerals.
- The list comprises 30 minerals including 17 rare earth elements (REEs) and six platinum-group elements (PGE).
- Ten minerals on the list are 100% import-dependent, including- Lithium, Cobalt, Nickel, Vanadium, Niobium, Germanium, Rhenium, Beryllium, Tantalum, and Strontium.
- India relies heavily on imports (mostly from China) for critical minerals. The demand for these minerals may more than double by 2030.
Global Distribution:
- China is the world’s largest producer of 16 critical minerals. China is responsible for 60% of global production of rare earth elements.
Steps taken by the Government of India:
1. MMDR Amendment Act, 2023:
- The Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act) is the primary legislation governing the mining sector in India.
- The MMDR Amendment Act, 2023:
- Empowers Central Government to exclusively auction mining lease and composite licence for 24 critical and strategic minerals (listed in the Part-D of the First Schedule to MMDR Act).
- Opened mining of critical minerals to private players which was previously limited to public sector undertakings.
- To boost exploration, Exploration Licence for reconnaissance and prospecting operations has been introduced for 29 deep-seated minerals.
2. Establishment of KABIL:
- A Joint Venture Company among NALCO, HCL and MECL named Khanij Bidesh India Limited (KABIL) was formed in August 2019.
- KABIL's mandate is to ensure India's supply of critical and strategic minerals:
- Identifying, exploring, acquiring, developing, mining, and processing strategic minerals.
- Focus on procuring battery minerals like Lithium and Cobalt.
3. Global Partnerships:
- India has joined the Mineral Security Partnership with 13 countries, including the U.S., Australia, and Japan aimed to catalyse public and private investment in critical mineral supply-chains globally.
- India has signed an agreement with Argentina for lithium exploration through KABIL (Khanij Bidesh India Limited).
- India-Australia has signed the Critical Mineral Investment Partnership for investment in critical mineral projects and for developing supply chains between these two nations.
4. Offshore Mining Initiatives:
- Offshore Areas Mineral (Amendment) Act, 2023 introduced transparent and non-discretionary auction process to allocate operating rights in the offshore areas.
- Deep Ocean Mission to explore the deep ocean to extract polymetallic nodules.
- National Geoscience Data Repository (NGDR) hosts all exploration related geoscientific data to facilitate the exploration.