India is currently in advanced negotiations for a potential agreement involving the exploration and development of five lithium blocks in Argentina. Simultaneously, New Delhi is engaged in talks with other nations possessing significant deposits of critical minerals.

According to reports, the contract for the exploration and development of five lithium blocks in Argentina is poised to be formalized between Khanij Bidesh India Ltd. (KABIL), a joint venture entity dedicated to discovering, acquiring, developing, processing, and commercially exploiting strategic minerals for supply in India, and Catamarca Minera Y Energética Sociedad Del Estado (CAMYEN), a government-owned mining and energy corporation based in the Catamarca province of Argentina.

The Central government plans to invest approximately Rs 200 crore over a span of five years for the exploration and development activities associated with these mines. "The talks are in the final stages, and a proposal has already been submitted to the Cabinet Committee on Economic Affairs for approval," stated a government official familiar with the development.

India is making its second endeavour to establish a foreign partnership for the procurement of critical minerals, following a prior collaboration with Australia. In 2022, the country formalized a memorandum of understanding with Australia's Critical Minerals Facilitation Office (CMFO) for the exploration of five blocks, specifically allocating two for lithium and three for cobalt.

Reports indicate that India is strategically planning to set up an overseas office for Khanij Bidesh India Ltd. (KABIL) in Catamarca. This initiative aims to streamline coordination with local regulatory authorities, reflecting a proactive approach to facilitate smoother operational processes in the region.

"In the exploration and extraction of critical minerals in Argentina, a substantial timeframe and continuous oversight will be essential," stated another senior official, as quoted in the Business Standard report. "Establishing the offshore office of KABIL is a strategic measure to protect and uphold our interests in this endeavour," the official added.

As per the 2023 Lithium Statistics and Information report by the United States Geological Survey (USGS), Argentina possesses 21% of the global lithium reserves, totaling 98 million tonnes, ranking second worldwide with Bolivia in the lead. The majority of these reserves are concentrated in the salt flats of Catamarca, Salta, and Jujuy provinces, forming the Lithium Triangle.

India's discussions with Argentina revolve around the cost-effective extraction of lithium from salt lakes, a method deemed more economical than hard-rock mining. This approach not only enhances commercial viability but also significantly boosts production. India's pursuit of lithium blocks in Argentina aligns with its efforts toward self-sufficiency in meeting the growing demand for clean energy.

India's first auction for critical minerals, featuring two lithium blocks, aims to secure the supply chain. The Reasi district holds an estimated 5.9 million tonnes of lithium reserves. India's lithium imports reached $3 billion in fiscal year 2023, with over 95% sourced from Hong Kong and China. KABIL is actively pursuing lithium exploration agreements with Argentina, Australia, Bolivia, and Chile. This aligns with India's goal of achieving net-zero emissions by 2070 and establishing itself as an electric vehicle manufacturing hub.

Image source: Business Standard