Is J&K’s lithium reserve a game changer in India’s adoption of EVs?

Discovery of 5.9 million tonnes of lithium reserve in Jammu and Kashmir's Reasi District is a major step in reducing India's dependence on import of EV batteries, laptops, mobile phones, etc. The reserves can help cater to India's lithium demand for its growing EV industry.

But one needs to look from a bird's eye-view to find out if the discovery can be a game-changer for India to achieve its sustainability goal. 

Uses of lithium 

Lithium is a very light and highly reactive and alkaline metal. It is mainly used in ceramics and glasses, greases, pharmaceutical compounds, air conditioners and aluminium production, etc. However, its main use is in battery due to its highest energy storage capacity per kilogram. Its high energy storage capacity combined with its extremely light weight makes it a perfect choice for electric car makers like Tesla. 

Lithium Reserve in India 

Lithium's discovery in Jammu and Kashmir is possibly not the element's first discovery in the nation. Two years ago, the light reactive metal was also found in Karnataka. Around 1,600 tonnes of lithium reserves were found in Mandya, Karnataka. But there hasn't been any commercial supply of the metal from that site till now.

In addition to that, the government is also running Lithium exploration program in several other states including Arunachal Pradesh, Andhra Pradesh, Chhattisgarh, Jharkhand, Jammu & Kashmir and Rajasthan.

A total of seven Lithium exploration were being carried out till 2021, Mint reported earlier. The project is being carried out by the Atomic Minerals Directorate for Exploration and Research (AMDER) under Department Atomic Energy (DAE) in Karnataka and Rajasthan.

Apart from exploring lithium in the mainland, homegrown companies are also looking for deals to buy lithium and cobalt mines overseas. For example the state-run Khanij Bidesh India Ltd (KABIL)— a joint venture firm of National Aluminium Company Ltd, Hindustan Copper Ltd. and Mineral Exploration Company Ltd. Hence, presence of Lithium in India can be a game changer only if the India manages to secure its reserves in abroad as well. 

India's current Lithium reserve vs Lithium reserves abroad 

Jammu and Kashmir's reserve might be present with a large amount of lithium, but the current amount is insufficient to match with the world's top reserves of Lithium. Bolivia has 21 million tonnes of Lithium, Argentina has 17 million tonnes of lithium, and Australia has 6.3 million tonnes of Lithium. Whereas, China has 4.5 million tonnes of the light metal. How China can be the OPEC in the Lithium market ? According to Forbes, China owns a total of 7.9% of the world's total lithium reserves, becoming the 3rd largest lithium supplier in the world in 2020.

The three countries, Bolivia, Chile and Argentina are together called as the ‘Lithium Triangle’ as South America is a highly rich source of the metal.

According to a US-based committee, China invested $16 billion in overseas mining from 2018 to 2020 for lithium exploration. It also invested in South America's ‘lithium triangle’ region.

Moreover, China enjoys global dominance in the field of electric vehicle production. Mainly, because of its early investment in the largest mining production operations in Australia, according to a Centre for Strategic and International Studies report.

Currently, Beijing holds 55 per cent of the chemical lithium supply required for electric vehicle batteries. Now, it is expanding its dominance in the the Lithium triangle as well. China’s Ganfeng Lithium holds majority of stake in Argentina’s Caucharí-Olaroz operation, which is assumed to one of the world’s top lithium production mines.

Moreover, it is also one of the biggest EV battery suppliers to India as well. This is a matter of concern for India, provided its tensed relationship with the dragon on territorial issues.

For India to become self-reliant in the field of EV manufacturing without being dependent on China for EV battery supplies, it is important to own more such Lithium reserves and enhance its presence in overseas lithium mines.