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31 January 2025

India Launches National Critical Mineral Mission To Boost EV Self-Reliance

The initiative seeks to secure the supply chain of key minerals for electric vehicles and clean technology.

India has officially launched the National Critical Mineral Mission (NCMM), aiming to transform its mineral sourcing framework and bolster self-sufficiency, particularly geared toward electric vehicle (EV) production and cleaner energy transitions. Announced on January 30, 2025, the initiative will primarily focus on decreasing India's heavy reliance on imported minerals, particularly lithium, which is fundamental to EV batteries.

The announcement came after the Union Cabinet's approval, marked by I&B Minister Ashwini Vaishnaw stating, "The launch of NCMM is pragmatic and visionary, securing the supply chain of minerals necessary for decarbonization through EV penetration." The mission endeavors to create a resilient and competitive mineral ecosystem within India and is set to invest roughly Rs 34,300 crore over the coming six years.

With plans to accelerate exploration efforts, the mission aims to raise domestic production levels significantly, acquire as many as 50 overseas mines by the fiscal year 2030-31, and establish infrastructure for intermediary processing and recycling of minerals. Public sector undertakings involved are anticipated to contribute around Rs 18,000 crore, complementing the government’s own allocation of Rs 16,300 crore.

The NCMM seeks to cover the entire value chain of important minerals: from exploration and mining to processing and recovery from end-of-life products. It will also promote the recovery of minerals from mining by-products and tailings, which could turn out to be key aspects for enhancing the domestic mineral supply.

India's current dependence on imports, particularly from China, poses strategic risks to the sustainable production of EVs. Official sources highlight, "With nearly 60%-70% raw materials for EV components sourced from China, ensuring our mineral availability is strategically important for sustainable EV production." Without reversing this trend and promoting local sources, the cost of producing electric vehicles is expected to remain prohibitively high.

Compounding the issue is the fact lithium-ion batteries constitute approximately one-third of the overall vehicle cost. The success of the NCMM is seen as pivotal for addressing not just local sourcing of raw materials, but also for making EVs affordable to the average consumer. While operational costs for EVs are comparatively low, high upfront prices will continue to stymie widespread adoption if the current situation does not improve.

Recent discoveries by the Geological Survey of India (GSI), particularly the establishment of lithium reserves in Jammu and Kashmir, have reignited hopes of self-reliance. It's noted, "The discovery by GSI getting massive support for research and exploration activities on lithium and other minerals is pivotal as it typically takes over 16 years from the discovery stage to actual production." This timeline adds urgency to the mission, as the country aims to develop its resources swiftly enough to meet growing demand.

The NCMM is anticipated to generate significant employment opportunities and showcase India's ambition to develop experts within the field of mineral exploration and processing. Educational institutions, such as engineering colleges and skill development centers, will need to introduce relevant courses early to cultivate the workforce needed for this burgeoning sector.

The role of the states will also be fundamental to the successful execution of the NCMM. They will need to streamline land acquisition processes and facilitate clearances for exploration activities, along with developing necessary infrastructure for transportation, power, and storage around mining areas. This collaboration between state and central governments is expected to maximize job creation and economic benefits.

With the NCMM's launch, India is laying the foundation for stronger and more independent access to the minerals necessary for its energy transition. This initiative stands as not only a strategic move for the EV sector but also as part of India's broader commitments toward achieving net-zero emissions by 2070. The transformation to clean fuel is not merely optional but necessary for the nation's climate goals.

Overall, the successful implementation of the National Critical Mineral Mission could redefine the future of India's transport sector and play a pivotal role in transitioning toward more sustainable energy solutions.