India is poised to make a significant move in the global lithium market with its plan to acquire five lithium blocks in Argentina. This development, spearheaded by Khanij Bidesh India Ltd. (KABIL), is in its final stages of negotiation. KABIL, a joint venture company, focuses on identifying, acquiring, developing, processing, and commercializing strategic minerals in foreign countries for India’s supply.
The agreement for the acquisition is set to be signed with Catamarca Minera Y Energética Sociedad Del Estado (CAMYEN), an Argentine state-owned mining and energy company. This initiative is a part of India’s broader strategy to become self-reliant in critical minerals, particularly those needed for clean energy and technology industries.
The Indian government plans to invest around Rs 200 crore over the next five years in the exploration and development of these lithium blocks. The decision to invest in Argentina’s lithium reserves is driven by the cost-effectiveness of extracting lithium from salt-lake deposits compared to hard-rock mining, making it a commercially viable option.
Argentina holds a significant position in the global lithium market, with 21% of the world’s 98 million tonnes of lithium reserves, according to the United States Geological Survey’s (USGS) Lithium Statistics and Information 2023 report. These reserves are primarily found in the salt flats of the Catamarca, Salta, and Jujuy provinces, which are part of the so-called Lithium Triangle.
This move follows India’s previous venture into securing critical minerals, which included signing a memorandum of understanding with Australia’s Critical Minerals Facilitation Office (CMFO) in 2022 to explore blocks for lithium and cobalt. Furthermore, India has initiated its first critical minerals auction, with two lithium blocks in Jammu and Kashmir and Chhattisgarh up for bidding.
The acquisition of these lithium blocks is not only strategic for India’s clean energy goals but also crucial for the country’s ambition to become a manufacturing hub for electric vehicles (EVs). Lithium is a key component in the production of lithium-ion batteries, which power a wide range of devices from smartphones to electric vehicles, as well as energy storage systems for renewable energy sources.
India’s current reliance on lithium imports, which totaled approximately $3 billion in FY23, underscores the importance of this deal. Over 95% of these imports come from Hong Kong and China. By securing its own lithium supply, India aims to reduce its dependence on imports and strengthen its position in the global market for critical minerals.
This agreement, once finalized, will significantly contribute to India’s goal of achieving net-zero emissions by 2070 and bolster its capabilities in high-technology sectors, including aerospace and medical treatments, where lithium has key applications.