Critical minerals can elevate EU-India relations

India and the European Union (EU) stand at a pivotal juncture where collaborative efforts could enhance economic growth that is climate-centric. This includes building resilient critical minerals supply chains and helping to address the urgent need for climate action to ensure that both regions can meet their ambitious environmental goals, while fostering economic resilience and technological advancement.

As record-breaking temperatures scorch both India and Europe and other extreme weather events dot the globe, the urgency of addressing climate change has never been more apparent. This underscores the pressing need for climate solutions, which are heavily dependent on critical minerals such as lithium, cobalt, nickel and rare earth elements.

These minerals are vital for technologies like solar panels and electric vehicles, which are the bedrock of the global green transition. They are a geopolitically contested resource group, given their geographic concentrations and the monopolistic nature of exploration and production by countries. They now have an increase in demand world over. 

India and the EU have released their lists of critical minerals, many of which are 100 per cent import dependent. While both have pushed for more domestic exploration, the returns on international partnerships (at least in the short and medium term) appear higher. Therefore, the alignment of critical mineral needs and supply chain bottlenecks provide an opportunity for both India and the EU to collaborate. 

This year marks 61 years of the bilateral relationship between the two partners. The renewed focus on the EU-India Free Trade Agreement (FTA) in 2022 and the establishment of the India-EU Trade and Technology Council (TTC) in 2023 underscore the strategic importance of this partnership. This includes over 50 bilateral dialogues on issues like cybersecurity, connectivity and energy. Both India and the EU share ambitious climate transition goals, underpinned by critical minerals. 

One of the key focus areas of engagement is that of enhancing research and innovation for critical raw materials. This would help ensure advancements in things like battery and storage technology, developing alternative supply sources and substituting of minerals, as well as enabling cost-effective technology solutions. 

India and the EU are both part of the Mineral Security Partnership (MSP) and can look to complement this framework by establishing research and innovation partnerships. Existing partnership frameworks such as India-EU Clean Energy & Climate Partnership and the India–EU TTC can be built on for promoting joint research and supporting knowledge transfer.

Another potential avenue to deepen engagement is the EU’s Global Gateway Initiative that aims to improve digital, infrastructure, energy, health and other connections across the globe.

The EU is already investing in critical mineral partnerships in Central Asia and Africa. In India, engagement under this initiative should be expanded to include clean energy through such a collaboration. 

Other minilateral frameworks such as the Quad, Supply Chain Resilience Initiative and the Indo-Pacific Economic Framework are also making forays into addressing the issue of critical minerals security.

Given the EU’s Indo-Pacific Strategy and its leadership in the MSP Forum, it could consider leveraging these forums with India. Engaging in consultations and coordination within these platforms would enable the two partners to secure supply chains and ensure economic security. 

Trilateral partnerships with third countries are another avenue for resources and knowledge sharing. The EU and Japan have a partnership focusing on sustainable extraction and processing, which New Delhi can consider replicating with Brussels. Given the strategic partnership between India and Japan, there could also be scope for an India-Japan-EU trilateral on advancing technologies for mineral extraction and processing.

The EU and India each have also established partnerships with Australia on critical minerals, and thus, establishing a trilateral framework between the three partners could also lead to significant results.

Sustainable mining, access to minerals and investment in exploration and processing infrastructure in Africa, Latin America and other Global South countries can also be explored.

To mitigate supply risks, sourcing minerals through recycling can be considered. This would help tackle the issues of exploration and setting up of new mines, many of which come with adverse environmental impacts and social backlash.

Under TTC, matchmaking events have taken place to promote cooperation on battery recycling technologies for electric vehicles. Increasing such collaborations can drive innovation in new technologies to promote clean energy advancements and boost the circular economy agenda. 

India and the EU’s technical expertise, accessibility to knowledge, skilled labour, capital and political will lay the foundations for a strong partnership on critical minerals.

By investing in innovation solutions and technologies, countries can enhance their strategic autonomy. This can also reduce the leverage of dominant suppliers, and create more stable, diversified and resilient supply chains.

The proactive approach not only strengthens national security but also promotes global stability by minimising the geopolitical power imbalances associated with these minerals. 

Anindita Sinh is a research analyst at the Centre for Social and Economic Progress (CSEP) in New Delhi. The views expressed are the writer’s own and not those of CSEP or Down To Earth.