India’s EV Ambition at Optimum, But Desperate Hunt on for Lithium

August 25, 2022
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According to McKinsey & Co, ‘despite expectations that lithium demand will rise from approximately 500,000 metric tons of lithium carbonate equivalent (LCE) in 2021 to some three million to four million metric tons in 2030, we believe that the lithium industry will be able to provide enough product to supply the burgeoning lithium-ion battery industry’.

But that is from a global perspective. India still has to depend on other countries, especially China; the country has no Lithium reserves to manufacture Lithium-ion batteries.

In February 2022, Researchers from the Directorate of Atomic Minerals (under the Atomic Energy Commission of India) estimated lithium reserves of 14,100 tonnes in a small stretch of land surveyed in southern Karnataka's Mandya district. Along with this, India's first lithium deposit site was also found.

While that is a ray of hope for the country, it still has a long way to go till the numbers match the reserve’s real deposits.

With the government pushing aggressively for EVs to hit the road, the centre has been trying hard to pass the mining sector reforms bill which will allow private companies to mine for Lithium among others.

India's imports of lithium and lithium-ion in FY21 stood at Rs 8,984 crore in FY21 and increased to Rs 13,838.22 crore in FY22. China and Hong Kong were the major sources of imports.

State-run Khanij Bidesh India Ltd (KABIL) is working with the authorities in Argentina, Chile, Australia and Bolivia for acquiring lithium and cobalt mines overseas.

But globally, there is a trend building up regarding shortage of Lithium and other metals. For example, According to International Energy Agency (IEA) just released report, ‘Australia is going to need to expand battery and minerals supply chains 10-fold to meet government EV ambitions around the world. Basically, the need is 50 more lithium mines, 60 more nickel mines and 17 more cobalt mines by 2030 to meet net carbon emissions goals’.

A delegation led by the Secretary (Mines) visited Argentina to evaluate the potential lithium projects for acquisition by KABIL. The delegation visited the province of Catamarca. Camyen, the state-owned enterprise of Catamarca province has assured that they will collaborate with KABIL to ensure preferential allocation of prospective Lithium bearing mineral acreages located within the province.

The visiting delegation also had extensive interaction with YPF, a federal government owned enterprise. Both YPF and KABIL outlined a broad contour of activities that need to be taken up with utmost priority as the acquisition process entailing engagement with target companies need to be started expeditiously.

Another Joint Working Group meeting of India-Australia under the Memorandum of Understanding (MoU) for cooperation in the field of mining & processing of Critical & Strategic Minerals was held in September, 2021 through virtual mode. In the meeting, it was decided that on the basis of the list of Lithium and Cobalt projects submitted by Australian side, more discussions will be held between CMFO and KABIL on the possible investment opportunities with more specific details of investment or participating interests of Government of Australia in such projects.

While these delegations and discussions go on, India will be in a hurry to find realistic delivery, and that too quickly.

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