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India has officially joined the US-led Minerals Security Finance Network, an initiative aimed at strengthening global cooperation in securing critical mineral supply chains. The announcement, made by the US State Department on Monday, highlights the growing importance of critical minerals in the global energy transition, particularly as nations work to reduce their reliance on fossil fuels.
The move comes as China continues to dominate the supply of critical minerals, raising concerns over the concentration and resilience of global supply chains. “The energy transition is at risk,” said Undersecretary of State Jose W Fernandez during the United Nations General Assembly in New York. “We need more production capacity for critical minerals that need to come online – many of these supply chains are concentrated in one or two countries and lack resilience,” he said.
What is the Minerals Security Finance Network?
The Minerals Security Finance Network is a new initiative emerging from the Minerals Security Partnership (MSP), a framework established by the US in 2022. The network aims to bring together institutions from the Indo-Pacific region and Europe, promoting cooperation, information exchange, and co-financing. These minerals, vital for the production of renewable energy technologies such as electric vehicle batteries, solar panels, and wind turbines, have become essential components of the global shift towards clean energy.
The US Department of State and the SAFE Center for Critical Minerals Strategy hosted development finance institutions (DFIs) and export credit agencies (ECAs) from MSP partner governments, on the sidelines of the United Nations General Assembly, to announce the establishment of the network.
Which countries are part of this initiative?
The partnership includes 13 countries and the European Commission. These are the United States of America, Australia, Canada, Estonia, Finland, France, Germany, India, Italy, Japan, the Republic of Korea, Norway, Sweden, the United Kingdom, and the European Union (represented by the European Commission).
India’s participation in this initiative is aimed at diversifying and securing its supply of critical minerals from nations like Argentina, Chile, Australia, and select African countries. Kazakhstan, in Central Asia, is also being explored as a potential source for India’s mineral requirements.
India’s critical mineral ambitions
India’s participation in this initiative is part of a broader effort to diversify and secure its supply of critical minerals from countries such as Argentina, Chile, Australia, and certain African states. Kazakhstan, in Central Asia, is also being considered as a potential source for India’s mineral needs.
This partnership with the US-led network marks a critical step forward for India in its quest to reduce reliance on China for these minerals and build a robust, self-sustaining supply chain for its green energy initiatives.
First Published: Sep 25 2024 | 11:27 AM IS