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MINING FOR CRITICAL MINERALS

7th December, 2023 Economy

MINING FOR CRITICAL MINERALS

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Context: The auction of critical mineral blocks represents a significant step toward enhancing domestic mineral production and reducing reliance on imports, especially for minerals crucial to industries like electric vehicles, consumer electronics, and energy storage.

Key Highlights

  • The auction encompasses 20 blocks spread across eight states: Tamil Nadu, Odisha, Bihar, Uttar Pradesh, Gujarat, Jharkhand, Chhattisgarh, and Jammu & Kashmir.
    • Mining Licenses (4): Immediate mining operations can begin upon obtaining the necessary clearances. These blocks contain deposits of minerals like nickel, copper, graphite, manganese, and molybdenum.
    • Composite Licenses (16): These blocks allow licensees to conduct further geological exploration to ascertain the presence and scale of mineral reserves. The licensees can apply to convert CLs to MLs after gathering adequate data on mineral deposits.
  • Various critical minerals such as lithium, nickel, copper, and rare earth elements (REEs) have been identified across different blocks with varying inferred reserves.

Clearance Requirements

  • Licensees need to obtain 15 approvals and clearances, including forest clearance, environmental clearance, Gram Sabha consent, etc.
  • Approximately 17% (1,234 hectares) of the total concession area (7,197 hectares) is forest land, subject to approvals through the PM Gatishakti portal.

Future Steps and Initiatives

  • India heavily relies on imports for critical minerals like lithium, nickel, and copper, highlighting the strategic significance of developing domestic sources. After this auction, plans are underway for another round of critical mineral block auctions.
  • The Geological Survey of India has undertaken numerous projects to explore critical mineral reserves across the country.
  • There's a recommendation to establish a Center of Excellence for Critical Minerals to formulate policies and incentivize the development of a complete value chain for these minerals within the country.

Critical Minerals

●Critical minerals are those with high economic importance and high supply risk due to factors like limited availability, geopolitical issues, environmental concerns, or technological challenges.

●Lithium, graphite, rare earth elements (REEs), cobalt, nickel, vanadium, antimony, beryllium, and bismuth. Essential for green energy, high-tech, aviation, defence, and healthcare.

●The Ministry of Mines collaborated with stakeholders to identify 30 critical minerals based on criteria like demand-supply gap, import dependence, strategic importance, and potential for domestic production.

Conclusion

  • The government aims to reduce dependence on imports, promote domestic production, and achieve a self-reliant ("Aatmanirbhar") India. The amendment of laws and setting competitive royalty rates are strategies to attract private investment in mining projects.

Must Read Articles:

Critical Raw Materials Act: https://www.iasgyan.in/daily-current-affairs/critical-raw-materials-act#:~:text=Antimony%2C%20Beryllium%2C%20Bismuth%2C%20Cobalt,%2C%20Zirconium%2C%20Selenium%20and%20Cadmium.

Critical Minerals: https://www.iasgyan.in/daily-current-affairs/critical-minerals

Critical Minerals for India: https://www.iasgyan.in/daily-current-affairs/critical-minerals-for-india

Royalty Rates For Mining of Critical And Strategic Minerals: https://www.iasgyan.in/daily-current-affairs/royalty-rates-for-mining-of-critical-and-strategic-minerals

PRACTICE QUESTION

Q. What are the key challenges and opportunities currently facing the mining sector in India, and how are stakeholders, including the government and industry players, addressing these issues to ensure sustainable and responsible mining practices?