WhatsApp Channel Join Now
Telegram Group Join Now

Relevance: GS-II (International Relations); GS-III (Indian Economy, Energy Security) Source: Economic & Defense Policy Updates, 2026

1 · Context

Imagine trying to build electric vehicles (EVs) and renewable energy grids without essential metals like lithium, cobalt, and nickel. It is impossible. These are known as Critical Minerals, and they form the foundation of the 21st-century green economy.

To secure these vital resources, India established a specialized overseas mining company named KABIL. However, KABIL is currently facing severe hurdles. Multi-million dollar mineral deals in resource-rich countries like Australia and Chile have stalled or fallen through because Indian public sector firms were outbid by wealthier global competitors. This highlights a critical economic challenge: how India can secure its long-term energy security and achieve its 2070 Net-Zero targets when global competition for raw minerals is intensely fierce.

2 · How India Tries to Secure Critical Minerals

Step 1: Establishing KABIL (2019)
India formed a joint venture of key public sector enterprises specifically tasked with scouting, exploring, and acquiring critical mineral assets overseas.
▼
Step 2: International Bidding
The entity attempts to acquire equity stakes in foreign lithium and rare earth mines (such as in South America and Australia) to guarantee future national supply chains.
▼
Step 3: Global Hurdles
Deals often fail because Indian bids are outmatched by heavily funded foreign corporations (like South Korea’s POSCO) and due to limited financial flexibility.
▼
Step 4: Domestic Reforms & Alliances
To mitigate risks, India is opening up domestic mining to private firms, joining global alliances like the MSP, and building local processing hubs.

3 · Key Economic & Policy Concepts

KABIL
The Overseas Vehicle
Khanij Bidesh India Ltd. A joint venture of three public sector companies created specifically to scout and acquire critical mineral assets abroad.
The Lithium Triangle
South America’s Reserve Hub
A geologically rich Andean region comprising Argentina, Bolivia, and Chile that holds more than half of the entire world’s proven lithium reserves.
Minerals Security Partnership
The Global Alliance
A US-led multilateral alliance of 14 nations (including India) designed to secure transparent critical mineral supply chains and reduce dependence on China.
MMDR Amendment Act
Unlocking Domestic Mines
A key legal reform that allows private sector companies to participate in exploring deep-seated and critical minerals within India for the first time.

Prelims Quick Facts: Challenges & Achievements
The Argentina Success Despite setbacks in Australia and Chile, KABIL’s major breakthrough came in Argentina, where it successfully acquired five lithium brine blocks in Catamarca.
The Australian Outbid In Australia, KABIL’s $233M offer for lithium mine stakes was easily beaten by South Korea’s POSCO, which aggressively secured the assets with a $765M bid.
Critical Minerals Mission India has identified 30 critical minerals essential for clean energy, launching a national mission to file 1,000 patents by 2030 for indigenous extraction tech.
The Midstream Gap A major domestic bottleneck is that India lacks sufficient local midstream metallurgy facilities to process raw minerals into usable battery-grade materials.

MCQ Practice Question
Q. With reference to India’s strategy for acquiring critical minerals, consider the following statements:

  1. KABIL (Khanij Bidesh India Ltd.) is a joint venture of public sector enterprises established to acquire critical mineral assets overseas.
  2. India is a formal member of the U.S.-led Minerals Security Partnership (MSP), which aims to secure transparent supply chains for critical raw materials.
  3. The MMDR Amendment Act, 2023 entirely bans private sector companies from engaging in the exploration of critical minerals in India.

Which of the statements given above is/are correct?
(a) 1 and 2 only    (b) 2 and 3 only    (c) 1 and 3 only    (d) 1, 2 and 3

Answer: (a) 1 and 2 only

  • Statement 1 — Correct: KABIL was incorporated in 2019 as a joint venture of NALCO, HCL, and MECL to secure strategic mineral assets abroad.
  • Statement 2 — Correct: India has formally joined the multilateral Minerals Security Partnership to diversify and secure critical mineral supply chains.
  • Statement 3 — Incorrect (the trap): The MMDR Amendment Act, 2023 actually did the exact opposite—it enabled private sector participation in deep-seated and critical mineral exploration to boost domestic production.
Ajmal IAS APSC Foundation Course

Recent Posts

Ajmal IAS APSC Foundation BATCH
Ajmal IAS APSC Foundation Course

Start Yours at Ajmal IAS – with Mentorship StrategyDisciplineClarityResults that Drives Success

Your dream deserves this moment — begin it here.