CIOInsider India Magazine
J&K's Lithium Deposit: Too Soon for India to Celebrate its Self Sufficiency?
In India, a significant deposit of lithium, a rare metal used to make batteries for electric vehicles and electronic devices, has been found. One of the largest lithium resources in the world is thought to be located in the Salal-Haimana area in the Reasi District of Jammu & Kashmir and it is estimated to be 5.9 million tonnes.
The Geological Survey of India's discovery of 5.9 million tonnes inferred deposits of lithium has been hailed as a game-changer in India's upcoming shift to a green economy. The Mines and Minerals (Development and Exploration) Act of 1957 states that the term inferred refers to the preliminary exploration stage, the second phase in a four-step procedure.
For manufacturing rechargeable batteries, which are used in a variety of electronic products, including as smartphones, laptops, and electric cars, lithium is regarded as a crucial component. The recent discovery of this sizable lithium deposit in India may be able to assist the nation in supplying its expanding domestic metal demand, which has been driven up recently by the popularity of electronic gadgets and electric vehicles.
Significance
According to a World Bank study, demand for essential metals like lithium (Li) and cobalt is predicted to increase by roughly 500 percent by 2050. India's market is anticipated to grow at a CAGR of 23.76 percent by 2028, while the global electric vehicle market is anticipated to reach $823.75 billion by 2030 and post a CAGR of 18.2 percent from 2021 to 2030. India wants to safeguard its essential mineral supply and increase its level of industry self-sufficiency.
Given that India currently imports 70 percent of its Li-ion cell needs from China and Hong Kong and all of its Li from Argentina and Australia, the lithium riches in J&K could help the domestic battery manufacturing industry. India could surpass China in terms of its Li stockpile if further exploration confirms the magnitude of the mineral reserves believed to exist in J&K.
India is just starting its refining efforts in Gujarat. At the 10th Vibrant Gujarat Global Conference, 39 Memorandums of Understanding (MoU) were signed, including those to establish the nation's first lithium refinery and research facility for nano satellites
According to state state leaders in J&K, plans for Li exploration would involve the local inhabitants, who will also be given preference for employment opportunities in exploration and mine development. The effects on local agriculture, animal husbandry, and tourism may not, however, be completely countered by employment in mining.
For instance, the district collectors of Bokaro, Dhanbad, and Ranchi incurred expenses of Rs. 1568.04 crore from DMF monies, according to a CAG audit from May 2022, without specifying the areas affected by mining or a list of those affected. Paradoxically, access to records pertaining to the operation of the State-Level Monitoring Committee was refused to the auditors.
Given the geostrategic significance of Li exploration and extraction, it is even more crucial that these activities be done in the public interest and without causing any major environmental or socio economic issues. Moreover, the most efficient use of Li reserves should go toward the key phases of the switch to renewable energy, as this will support efforts to combat energy poverty and promote sustainable development.
Refining Lithium
China is an outlier in the lithium market. Only 7.9 percent of the world's lithium reserves were held by the nation at the end of 2020, according to BP's Statistical Review of World Energy 2021. But the manufacturing of metal is where the nation excels. About 60 percent of the world's capability for processing and refining lithium is thought to be located in China.
Depending on the source of the lithium and the extraction technique, the process of refining lithium can be difficult and complex. Lithium is mostly obtained from mineral sources, such as spodumene, petalite, and lepidolite, although it must first be extracted by mineral processing. This procedure involves crushing the ore, followed by the extraction of the lithium using froth flotation, magnetic separation, and gravity separation, among other methods.
India is just starting its refining efforts in Gujarat. At the 10th Vibrant Gujarat Global Conference, 39 Memorandums of Understanding (MoU) were signed, including those to establish the nation's first lithium refinery and research facility for nano satellites.
The MoUs) also include the first contracts that academic institutions sign for training and research. An agreement was inked by Manikaran Lithium Private Limited to build the nation's first lithium refinery in the state, which would produce high-purity battery grade lithium.
In line with those efforts, Manikaran Power Limited, one of the biggest power trading and renewable energy companies in the nation, Manikaran Power Limited, is said to be investing over Rs 1,000 crore to build this refinery. They are currently looking into a few locations in Sanand and Dholera to build this refinery, and they will undoubtedly come to Gujarat.
Few Lessons to Take Note
India could learn from the experiences of South American nations as it sets out on this new journey, particularly those in the lithium triangle of Bolivia, Chile, and Argentina, which holds around half of the known Li in the globe. Li extraction has either been controlled by the government in Bolivia and Chile or calls for mining firms to sign contracts with state-owned businesses.
Legislators in Mexico brought changes last year to ban any direct private investment and production in the Li sector and to establish a state-owned entity to extract, process, and sell Li. The region's regulations intended to safeguard Indigenous peoples have been put to the test by the negative socio-environmental effects of Li mining, notwithstanding this.
A new compliance plan for $52 million was accepted by Chilean authorities in August 2022, in which SQM suggested collaborating with the regulator and local community to rectify environmental violations.
These developments highlight the necessity of a robust regulatory framework that can handle both the environmental and the socioeconomic effects of Li mining, even though such comparisons must take into account inter-regional variances.
