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Business News/ Politics / Policy/  Centre likely to auction lithium reserves by June

Centre likely to auction lithium reserves by June

Bidding is allowed on condition that all refining will be in India
  • India currently has no facility to refine lithium
  • India discovered 5.9 million tonnes of lithium in Jammu & KashmirPremium
    India discovered 5.9 million tonnes of lithium in Jammu & Kashmir

    NEW DELHI : The government is poised to invite bids for the auction of the newly discovered lithium reserves in Jammu as early as the June quarter, a move that will give India access to the strategic mineral that helps power everything from mobile phones to electric vehicles.

    Earlier this month, the Geological Survey of India (GSI) reported the presence of significant lithium reserves totalling 5.9 million tonnes in the Reasi district of Jammu and Kashmir. The find has catapulted India into the world’s seventh-largest holder of lithium reserves.

    The discoveries are not early-stage finds, and the government plans to call for bids to start the process, a government official said. “[This is a] G-3 level find, which means we are sure of significant reserves and, hence, starting the process to mine this critical non-ferrous metal soon," the official said.

    Graphic: Mint
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    Graphic: Mint

    Based on United Nations Framework Classification (UNFC), which is a three-dimensional system considering geological, feasibility, and economic factors, the reserves are classified into four stages—G4 (reconnaissance), G3 (prospecting), G2 (general exploration) and G1 (detailed exploration).

    The official added that the auctions would be open to all, like any other government auction, with one key condition: “The government would mandate that lithium found is refined only in India and not sent abroad for processing."

    India currently has no facility to refine lithium. However, the country has set an ambitious target of achieving 30% electric vehicle (EV) penetration in private cars, 70% for commercial vehicles, and 80% for two and three-wheelers by 2030 for the automobile industry.

    The country requires lithium to fuel its energy transition target. The mineral is a key component in rechargeable lithium-ion batteries used in electric-vehicle manufacturing and large-scale battery storage. The recent discovery of lithium reserves is set to bolster India’s access to this vital resource.

    China controls 75% of the world’s lithium refining and India secures lithium from Hong Kong, China and the US. However, the ongoing Russia-Ukraine war has disrupted supply, spiking costs. Besides GSI, a consortium of three PSUs—National Aluminium Co., Hindustan Copper and Mineral Exploration Corp.— is working to provide a vehicle for research and development for recycling, acquisition and joint manufacturing of lithium-ion batteries.

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    Mihir Mishra
    A senior editor at Mint, Mihir writes on the corporate sector. Mihir has an experience of 15 years in the field of journalism. His previous stints include Business Standard, The Indian Express and The Economic Times.
    Catch all the Politics News and Updates on Live Mint. Download The Mint News App to get Daily Market Updates & Live Business News.
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    Published: 21 Feb 2023, 11:13 PM IST
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