While most of the headlines regarding the trade war between the United States and China — and, for ARPN followers, the underlying tech war over who which country will dominate the 21st Century Technology Age — focus on the main players in Washington, DC and Beijing, the ripple effects of this confrontation can be felt all over the world.
Case in point: India, which although rich in mineral resources, relies to a significant extent on Chinese imports to meet domestic needs. As the New Delhi-based Institute for Defence Studies and Analyses (IDSA) recently outlined, India is one of the few countries that is home to vast REE reserves, but is ranked low in the REE market and considered more of a “low-cost supplier of raw materials.”
The fact that most of REES consumed in India are imported from China, deprives the country of an “opportunity to earn substantial revenues as a supplier of hi-tech equipment like neodymium magnets” – particularly because the country is lacking a downstream sector, i.e. the manufacturing of intermediate products. “[i]nterestingly Japan currently imports dysprosium from India, using it to manufacture advanced neodymium magnets which are of high value, and today controls a sizeable portion of the global neodymium magnets market.”
Realizing the urgency of the situation, the Indian government, albeit late to the race, has taken first steps to strengthen its critical minerals outlook, and earlier this summer released a new National Mineral Policy aimed at increasing the production of major minerals by 200 percent in 7 years.
Home to about 6.9 million metric tons of REEs – which amounts to roughly one-fifth of global reserves — companies have begun exploring REE opportunities domestically.
More must be done, however, says IDSA:
“While a beginning has been made with the announcement of a National Mineral Policy 2019, covering non-fuel and non-coal minerals, India must strive to acquire expertise in valorising these minerals and shift to developing its downstream sector.”
As co-founder of Technology Metals Research Jack Lifton suggested earlier this year, India could well become an alternative supplier of REEs to the world as it “has large reserves of monazite and is unexplored for other rare-earth minerals. (…) What’s missing is a domestic downstream processing supply chain. If this is constructed, India will become a major producer.”
“To that end,” concludes the IDSA analysis, “India should seek to leverage its ties with Japan and other countries that have the requisite technology for manufacturing downstream equipment so that it can set itself up as an alternative source of the REE-based technology, with its own supply chain of minerals and metals required for the same, instead of being content with being a mere supplier of upstream materials.”
As the U.S. continues to forge partnership agreements with allied nations such as Australia and Canada to secure its critical mineral supply chains, expect other nations like India to do the same. The scramble for the world’s mineral resources has only just begun.