India faces uphill battle in Lithium mining and exploration
India is striving to establish reliable lithium supply to bolster its growing electric vehicle (EV) industry with its recent INR 200 crore investment in lithium exploration in Argentina by the Ministry of Mines. Despite these efforts, industry experts caution that the nation's lithium mining and processing sector is essentially starting from scratch, with limited immediate impact expected from the latest developments.
Currently, India imports 100% of its lithium, with a significant portion (over 95%) sourced from China and Hong Kong.
The joint venture Khanij Bidesh India Ltd (KABIL), involving NALCO, HCL, and MECL, has secured exploration rights in Argentina, adding to previous agreements with Australia for lithium and cobalt exploration. However, the lithium industry faces a prolonged gestation period, averaging 6 to 7 years from discovery to production in South American brine assets, as per the International Energy Agency (IEA).
Ritabrata Ghosh, Vice President — Corporate Ratings & Sector Head at ICRA, emphasizes that China currently dominates 65% of the lithium processing/ refining industry, an area where India lacks a foothold.
He notes, «There are two parts to it: mining and processing, two separate activities that need to be individually focused on and developed. Argentina has brine deposits, for which the extraction and processing technology is well proven.
However, one thing is certain: the path to commercializing these assets can be long due to India's limited expertise in lithium mining and India’s limited track record of successfully developing mining assets in a foreign country due to elevated execution risks. „
Globally, lithium is found in brine deposits, hard rock deposits, and clay deposits.
