WORLD'S LITHIUM

2. The status of India's lithium industry

• India's electric vehicle (EV) market was valued at $383.5 million in 2021 and is expected to expand to $152.21 billion in 2030.
• India imported 450 million units of lithium batteries valued at $929.26 million (₹ 6, 600 crores) in 2019-2020, which makes the development of the country's domestic lithium reserves a matter of high stakes.
• Scholars have argued the ongoing global transition to low-carbon economies, and the rapid expansion of artificial intelligence (AI) and 5G networks will greatly reshape global and regional geopolitics.
• Access to and control over rare minerals, such as lithium and cobalt, will play a crucial role in these epochal changes.

3. Owner of these minerals

• In July 2013, a three-judge bench of the Supreme Court of India ruled that the owner of the land has rights to everything beneath, "down to the centre of the earth".
• Yet, large areas of land, including forests which make up more than 22 per cent of India's landmass hills, mountains and revenue wasteland are publicly owned.
• The Supreme Court also recalled that the Union government could always ban private actors from mining sensitive minerals, as is already the case with Uranium under the Atomic Energy Act 1962. In today's context, lithium is as important as, if not more than, uranium.

4. Other countries manage lithium reserves

• The stories of two South American countries, Chile and Bolivia which have the largest known reserves of lithium are particularly instructive.
• In Chile, the government has designated lithium as a strategic resource and its development has been made the exclusive prerogative of the state.
• The state has licensed only two companies SQM and Albemarle to produce lithium in the country.
• In April 2023, Chile's announced a new "National Lithium Strategy", which many in the corporate sector took to be a declaration of his intention to nationalise the industry.
• On the contrary, the government would honour existing contracts.
• As a supplement, the new strategy calls for public-private partnerships for future lithium projects, which will allow the state to regulate the environmental impact of lithium mining, distribute the revenue from lithium production more fairly among local communities and promote domestic research into lithium-based green technologies.
• Bolivia's new constitution gave the state "the control and direction over the exploration, exploitation, industrialisation, transport and commercialisation of natural resources".
• It nationalised lithium and adopted a hard line against private and foreign participation.
• This is believed to be one of the factors for the country's failure to produce any lithium at a commercial scale nearly 20 years after the industry was nationalised.
• Bolivia's current president seeks to change that. However, instead of handing over lithium resources to the private sector and wants to join hands with other Latin American countries to design a " lithium policy" that would benefit all their economies.
• Mexico's president also nationalised lithium in February this year, declaring, "Oil and lithium belong to the nation, they belong to the people of Mexico".
• In general, the countries in Latin and South America are thinking through ways and means to pursue a multipronged strategy.
• While the national governments of these countries exercise a significant degree of control, the nature of private-sector participation varies between these countries.
• The actions of these governments are also a response to the mobilisation of Indigenous Peoples in the region who want to hold corporations as well as governments to account.

5. The way forward

• As India explores and develops its lithium reserves, it is notable that the appropriate development of this sector will require a very high level of effectiveness on the part of the Indian state.
• Much of India's mineral wealth is mined from regions with very high levels of poverty, environmental degradation and lax regulation.
• Effective and careful management of the sector should be paramount if India's rare minerals development is to meet its multiple goals of social well-being, environmental safety and national energy security.