Highlights
- US and India establish collaborative venture to recover and process critical minerals like lithium, cobalt, and rare earth elements.
- Partnership aims to diversify supply chains and reduce dependency on China’s dominant rare earth market.
- Joint initiative will enhance research, investment, and strategic autonomy in semiconductor and clean energy technologies.
In what could eventually turn out to be a decisive move to fortify technological and energy sectors, India and the United States have embarked on a collaborative venture to recover and process critical minerals, including lithium, cobalt, and rare earth elements, as the White House reported on February 13th in a briefing statement (opens in a new tab). This initiative, announced during a bilateral meeting between President Donald Trump and Prime Minister Narendra Modi, underscores the strategic importance of these minerals in advancing semiconductor technology and clean energy solutions.
Strengthening Bilateral Ties
The partnership aims to enhance research and development, promote investment across the critical mineral value chain, and build resilient supply chains. This collaboration is further solidified by a Memorandum of Understanding (MoU) between the U.S. National Science Foundation and India’s Anusandhan National Research Foundation (opens in a new tab), focusing on critical and emerging technologies.
As pointed out in Outlook Business (opens in a new tab) in India, this is a new US-India program to recover and process critical minerals, including lithium, cobalt, and rare earths from heavy industries like aluminum, coal mining, and oil and gas, a joint statement after a bilateral meeting between US President Donald Trump and PM Narendra Modi. The nations will seek to accelerate collaboration in research and development and promote investment across the entire critical mineral value chain, as well as through the Mineral Security Partnership, of which both the United States and India are members.
The China Factor
Not much was discussed about China, at least not publicly, other than the fact that the two nations need to be less dependent on the Asian giant and number two economy next to the USA. China’s dominance in the rare earth market raises mounting concerns. China controls approximately 70% of global rare earth ore extraction and 90% of rare earth processing capacity, positioning it as a pivotal player in the global supply chain.
This monopoly has significant implications for countries like India and the U.S., which are striving to secure alternative sources to reduce dependency and enhance strategic autonomy.
Implications for the Rare Earth Ecosystem
The U.S.-India collaboration represents a strategic effort to diversify supply chains and mitigate the risks associated with over-reliance on a single dominant supplier. By investing in joint recovery and processing initiatives, both nations aim to bolster their technological and defense industries, ensuring a stable supply of these indispensable materials.
While the recent White Houe briefing highlights the burgeoning partnership between India and the U.S. in the realm of critical minerals, it stops short of addressing the broader geopolitical context, particularly China’s prevailing influence over the rare earth market. Recognizing and confronting this reality is crucial for the success of such international collaborations.
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