Highlights

• US and India sign strategic MoU to diversify critical minerals sources and reduce reliance on China's global dominance
• Partnership leverages complementary strengths in technology, manufacturing, and clean energy innovation
• Collaboration targets resilient supply chains for semiconductors, electric vehicles, and renewable technologies

---

The blog post, authored by Anindita Sinh, writing for the Center for Social and Economic Progress, (opens in a new tab) discusses the growing India-US partnership on critical minerals, emphasizing its potential to create resilient supply chains and counter China's dominance in the sector.

The hypothesis centers on leveraging the complementary strengths of both nations—India’s growing manufacturing capabilities and renewable energy goals alongside the U.S.’s technological expertise and financial resources—to secure critical minerals vital for clean energy, technology, and defense innovations.

Indian American Direction?

India and the U.S. have signed a Memorandum of Understanding (MoU) on critical minerals supply chains, aiming to diversify sources and reduce reliance on China, which controls 60% of global rare earth mining and 80% of processing capacity. Shared goals include fostering collaboration in areas like lithium and rare earths, which are crucial for clean technologies such as electric vehicles, solar panels, and semiconductors. The partnership is seen as a strategic imperative, especially in light of geopolitical tensions like China’s recent ban on critical mineral exports to the U.S.

The article highlights initiatives such as the Initiative on Critical and Emerging Technologies (iCET) and India’s inclusion in the U.S.-led Minerals Security Partnership (MSP), reflecting a shared vision of supply chain resilience. Key policy frameworks, such as the U.S.-India Climate and Clean Energy Agenda 2030 and the Strategic Clean Energy Partnership, underscore a convergence of priorities on energy security and climate resilience.

What are the key points and opportunities?   First, shared goals and overlapping interests cannot be ignored. The 80% overlap between the U.S. and India’s critical minerals lists demonstrates significant alignment, particularly in sectors like clean energy and semiconductors.

Second, geopolitical relevance means collaboration addresses overdependence on China and positions the partnership as a counterweight to Beijing’s influence in critical minerals markets. Third comes complementary strengths. This means the U.S.’s financial and technological capabilities, paired with India’s cost-effective manufacturing ecosystem, create opportunities for joint exploration, mining, and processing in third-world countries such as Africa and Latin America.

Finally, there is potential for Indian American innovation.  The partnership can foster advancements in recycling, AI-based resource mapping, and sustainable extraction technologies.

What are some key challenges ongoing?

First is divergent priorities.  While the U.S. focuses on mining and processing, India prioritizes research, recycling, and sustainable alternatives, requiring coordination to harmonize goals.  Then, there are the infrastructure and regulatory barriers. India’s limited domestic reserves and the U.S.’s stringent environmental laws could slow progress.

We cannot underestimate the ongoing dependency on China. Despite diversification efforts, breaking China's monopoly on processing capacity remains a formidable challenge.

Finally, Rare Earth Exchanges suggests that the specter of domestic opposition in the U.S. to prioritizing foreign collaborations and India’s protectionist tendencies could hinder cooperation.

The post reflects an optimistic tone, framing the partnership as a mutually beneficial solution to critical minerals challenges while downplaying complexities. It glosses over the significant geopolitical risks and competition from other countries with established critical mineral capabilities. Additionally, the emphasis on shared values and strategic alignment may oversimplify the realities of aligning policies between two nations with distinct economic and political systems.

Conclusion

The India-US critical minerals partnership presents a promising opportunity to build resilient supply chains and accelerate clean energy transitions. However, investors and policymakers should critically assess the practical hurdles, including funding, regulatory barriers, and the geopolitical landscape. While the partnership is a step in the right direction, its success depends on clear timelines, transparent governance, and sustained commitment from both nations to navigate the challenges ahead.