Creamer Media Correspondent
KOLKATA (miningweekly.com) – The Indian government has mandated all State-owned mineral-based companies to pool their resources to acquire lithium and cobalt assets overseas.
A rough deadline of March 2019 has been set for these companies to complete all formalities, such as leveraging their balance sheets jointly, form joint ventures (JVs), consortiums or any such suitable corporate structures so that process of scouting and acquiring lithium and cobalt assets could get under way next financial year.
“The mandate for these companies is to acquire and source strategic minerals, lithium and cobalt from abroad,” joint secretary of the Mines Ministry, Anil Kumar Nayak, said.
“Joint ventures of government companies will acquire assets overseas and do the mining operations jointly with entitled agencies in host countries. We will also invite Indian private companies to join in the proposed ventures,” he added.
The model to be followed would be the JV of State-owned National Aluminium Company Limited, Hindustan Copper Limited and Mineral Exploration Corporation Limited, formed last year.
The venture, christened Khanij Bidesh India Limited, has been directed to complete all internal corporate formalities and start acquiring assets overseas in the next financial year.
With India aiming to have at least 30% of vehicles in the country powered by batteries, the government reckons that building domestic electric vehicle (EV) battery manufacturing capacity backed by raw materials – lithium and cobalt – sourcing will hold the key to success of achieving the target and reducing crude oil import bill, a Mines Ministry official said.
Towards this end, government-run Central Electro Chemical Research Institute and the RAASI Group last week signed an agreement to set up the first domestic EV battery manufacturing facility in the country based on indigenous technology developed by government’s Council for Scientific Research Institute.
However, the success of building optimal domestic battery manufacturing capacities would hinge of ensuring stable raw material security for these ventures and hence the mandate to government mineral companies to come together and acquire such raw material assets overseas, the Ministry official said.
The push to government mineral companies comes in wake of offers last year from Chile, Argentina and Bolivia, the so-called ‘lithium triangle’, that they would prefer a two-tier JV between Indian companies and local partners in return of contracts to buy-back lithium produce at concessional rates.
With Indian government companies spearheading such ventures, it would be easier for the Indian government support through bi-lateral diplomatic channels with these countries, Ministry officials pointed out.
According to forecast of a government policy advisory body, India’s lithium requirement to meet the projected demand for EV batteries by 2030 would be around 60,000 t/y and though this would be just 0.7% of the global reserves, future EV battery manufacturing faced the risk of short term shortages.
Ironically, while the Bolivian government has offered a government-to-government pact for supply of lithium, India does not even have an embassy in La Paz (Sucre) and the Indian embassy in Peru is accredited to Bolivia, even as China made inroads in investing in Bolivian mining industry.
Expand
(20min delay)
