Editorial

Critical mineral hope in EV penetration

India’s dream of decarbonizing the transport sector through the penetration of electric vehicles (EV) has been restrained by the high upfront cost of vehicles

Sentinel Digital Desk

India’s dream of decarbonizing the transport sector through the penetration of electric vehicles (EV) has been restrained by the high upfront cost of vehicles despite incentives for the automobile industry and end consumers. The high cost of lithium-ion batteries is one of the key factors behind the high upfront costs of these battery-operated vehicles. India is heavily dependent on the import of lithium-ion batteries. Without a reversal of the situation and the country attaining self-reliance on EV batteries, a mere increase in the incentives will not take the country closer to its goals. Union Cabinet’s approval of the launch of the National Critical Mineral Mission (NCMM) has rekindled hope for India moving towards self-reliance in EV battery manufacturing. The government has already initiated steps for improving charging for EVs to remove range anxieties which are another factor influencing consumer sentiments in the automobile sector. Even when range anxieties are reduced high upfront costs driven by very costly batteries will continue to pose a stumbling block in popularising EVs as average consumers will not be able to afford highly priced EVs. The battery accounts for nearly one-third of the vehicle cost, and reducing this cost remains the primary challenge even though the operational cost of EV is significantly less compared to fossil-fuel-operated vehicles. The proposed mission will involve government expenditure of Rs 16,300 crore and investment by public sector undertakings to the tune of Rs 18,000 crore. The National Critical Mineral Mission, approved by the Union Cabinet, will encompass all stages of the value chain, including mineral exploration, mining, beneficiation, processing, and recovery from end-of-life products. The mission will intensify the exploration of critical minerals within the country and in its offshore areas. It aims to create a fast-track regulatory approval process for critical mineral mining projects. Additionally, the mission will offer financial incentives for critical mineral exploration and promote the recovery of these minerals from overburden and tailings, states an official release. Other key targets of the mission include encouraging Indian PSUs and private sector companies to acquire critical mineral assets abroad and enhance trade with resource-rich countries, developing the stockpile of critical minerals within the country, setting up mineral processing parks, supporting the recycling of critical minerals, and promoting research in critical mineral technologies. The withdrawal of customs duty on major critical minerals has cleared the decks for the availability of lithium and other critical minerals in the country. Smooth and uninterrupted supply of critical minerals will be crucial for the sustainability of decarbonisation initiatives through EV penetration. To address this strategic requirement, the NCMM has set its objective to secure a critical mineral supply chain by ensuring mineral availability from domestic and foreign sources. India currently sources nearly 60%-70% of raw materials for EV components, including batteries, from China, which implies that more EV production in the country without building its self-reliance will only increase the country’s dependence on the neighbouring country, which is a strategic risk in the the sustainability of EV production and operation. The Geological Survey of India (GSI) establishing lithium inferred reserves in Jammu and Kashmir has brightened hopes of India building self-reliant lithium-ion batteries. The GSI getting massive support for research and exploration activities on lithium and other critical minerals is crucial as it takes more than 16 years from the the discovery of such resources to actual production. Considering this challenge, the the Union Cabinet approving the expedited launch of NCMM is a pragmatic and visionary move. For, once the country transforms its transport sector to clean fuel replacing fossil fuels then a smooth, uninterrupted supply of clean fuels at an affordable cost will be vital for the long-term sustainability of the transformation. The transformation to clean fuel is a compulsion and not a choice for the country to achieve its climate mitigation goals of net zero emissions by 2070. In any industry sector, bridging the gap between research and commercial success of invention, innovation, and technology is not easy and goes through a a lot of experimentation. The availability of required human resources will need to prioritise a key mission component of promoting expertise and a skilled workforce in critical minerals. The country achieving the goals of a challenging mission like NCMM in a a time-bound manner will require the states to play their part. This includes states simplifying and fast-tracking land acquisition and clearances for exploration and mining activities and developing transportation, power, and storage infrastructure near critical mineral mining areas. The pool of experts and skilled professionals must come from states, and NCMM will create huge opportunities for employment opportunities. Engineering colleges, universities, and skill development universities and institutions introducing relevant courses, subjects, and trades well in advance will be necessary to meet the requirement in critical mineral value chain development in which the states playing the lead role going to benefit the most in tapping the maximum share of employment avenues. The NCMM launch has ignited new industrial dreams in India’s EV sector.