TAG: GS 3: ECONOMY
THE CONTEXT: India has witnessed a substantial increase in its mineral imports over the past five years, with the value of these imports rising by nearly 80% to ₹68,633 crore in FY24.
EXPLANATION:
- This significant growth in mineral imports reflects the country’s rising demand for various raw materials essential for industrial and infrastructural development.
- Although the overall imports decreased slightly by 2% on a year-on-year basis from ₹70,125 crore, the trend over the five-year period shows a clear upward trajectory from ₹38,604 crore in FY19.
Key Mineral Imports and Their Economic Impact
- India’s major mineral imports encompass a range of non-critical minerals, including copper ore concentrates, phosphorite, manganese ore, limestone, iron ore, bauxite, asbestos, sulphur, magnesite, and fluorspar.
- These minerals account for 97% of the total mineral imports by value.
- In FY24, the import of copper ore concentrates led the pack, reaching ₹25,951 crore, which represents nearly 40% of the total value of major mineral imports.
- The import value of copper ore more than doubled over five years, rising from ₹12,146 crore, indicating a strong demand for this essential raw material in India’s industrial sectors.
- Phosphorite followed as the second-highest import at ₹12,649 crore, contributing about 20% to the total mineral import value.
- Like copper ore, phosphorite imports also saw a substantial increase, more than doubling from ₹5,625 crore in FY19.
- Other significant imports included manganese ore, limestone, and bauxite, with import values of ₹7,760 crore, ₹6,616 crore, and ₹4,397 crore, respectively.
- These materials are critical for various industrial applications, including steel production, construction, and manufacturing.
Volume Growth of Mineral Imports
- In terms of volume, India’s imports of these ten major minerals rose by 9% over five years, reaching 619.42 lakh tonnes in FY24, up from 570.34 lakh tonnes in FY19.
- On a year-on-year basis, the import volume grew by 17%, reflecting the increasing demand for these essential minerals.
- Limestone topped the volume charts with imports totaling 338.09 lakh tonnes, accounting for 55% of the total volume of major mineral imports.
- Phosphorite followed with 55.98 lakh tonnes, making up 14% of the total import volume.
- This indicates a heavy reliance on imported limestone, which is crucial for the cement and construction industries, as well as on phosphorite, vital for the production of fertilizers.
Critical Mineral Imports: Addressing Strategic Needs
- India also imports a significant amount of critical minerals, which are essential for the country’s green transition and technological advancements.
- In FY24, critical mineral imports across 24 categories, excluding lithium-ion and copper, amounted to ₹35,000 crore, with a total volume of 82,260 tonnes.
- These minerals include beryl and beryllium, cadmium, cobalt, gallium, glauconite, graphite, indium, lithium (bearing minerals), molybdenum, nickel ore, rock phosphate, platinum group of minerals, potash, rare earth elements, rhenium, selenium, tantalum, titanium, tin, tungsten, vanadium, and zirconium.
- Among these, rock phosphate imports were the highest in value at over ₹12,600 crore, followed by nickel ore imports valued at approximately ₹6,557 crore.
- Lithium-bearing mineral imports, crucial for energy storage solutions, also saw significant import values close to ₹900 crore, underscoring India’s growing focus on developing sustainable energy infrastructure.
Global Concentration of Critical Mineral Reserves
- The global reserves of these critical minerals are primarily concentrated in a few countries, including Australia, Argentina, China, Chile, Canada, Congo, Mozambique, and South Africa.
- Union Mines Minister emphasized in a parliamentary response that these minerals are vital for India’s green transition, particularly lithium, which plays a crucial role in energy storage technologies.