India mulling to discuss mechanism with Australia under FTA for smooth supply of critical minerals
The Hindu
Australia produces almost half of the world's lithium. It is also the second-largest producer of cobalt and the fourth-largest producer of rare earth.
India is considering to discuss a mechanism with Australia for a smooth supply of their critical minerals under the comprehensive Free Trade Agreement (FTA) amid a huge demand in the domestic market, according to sources.
India and Australia have implemented an Economic Cooperation Trade Agreement (ECTA) in December 2022, and now negotiations are on for expanding the scope of that agreement into a comprehensive pact (Comprehensive Economic Cooperation Agreement or CECA).
There is a huge demand for critical minerals like lithium, titanium, vanadium, cobalt, nickel, and graphite in India as the country is targeting to boost the production of renewable energy by 2030.
Batteries will enable the current energy transition towards electric mobility, integration of renewable energy through grid-scale storage and improved energy access in India.
India's lithium-ion battery manufacturing capability is currently limited, and existing manufacturers are largely reliant on imports.
There is an MoU (memorandum of understanding) signed between Khanij Bidesh India Ltd (KABIL) -- a joint venture of three central public sector units under the Ministry of Mines -- and the Critical Minerals Facilitation Office (CMFO), Government of Australia, which aims at strengthening bilateral trade relationship and lays the path to deliver on a shared ambition to develop secure, robust and commercially viable critical minerals supply chains.
The sources said that at present, nothing has been finalised, but there is a consideration that "we can think of some kind of mechanism under which India can get assured supply of these minerals".