India’s venture into the Lithium Triangle
Lithium Triangle, comprising of Chile, Bolivia and Argentina, currently is the most sought-after region in South America. Current situation of the lithium triangle has seen with progress bi- lateral and multi- lateral trade agreements with the region. As the global surge for lithium has initiated, crucial for developing modern day battery system in electronics and possible defense technology, majority of countries have focused to negotiate deal with the region. Over 65% of lithium reserves are found in this region and along with countries like United States of America and China, India has sought after establishing its influence in the search for lithium reserves. The exploration of lithium is due to recently discovered potential of performance with the usage of lithium. The stage at which lithium is being used is still currently at its infant stage. Before the idea to include lithium-based technology in defense, mobile and laptop batteries are run on lithium- ion technology. India’s current quest for lithium is a 2-fold agenda. First agenda focuses on the military and defense advancements in the subcontinent. Second focuses on challenging the rising Chinese strategic influence in the global area and over India. These two parameters have pushed New Delhi to tap into the global lithium chain and seek out new economic and trade relations to fulfill these targets. Its imperative to fully comprehend the importance and the current usage of lithium by other nations. India’s position is dependent on a comparative and its progress on the lithium-based technology and its development.
India’s initiative to move into the global lithium value chain opens a new strategic and infrastructural venture for the subcontinent. The value of lithium has recently got the surge in terms of its demand and usage among the international community. Part of the 21st century is defined by the number of technological ventures that have been pursued by nations. Lithium metal batteries have specifically got attention due to its high performance, efficiency and utility of the devices. India’s venture into the lithium value chain has been a delayed action as compared to countries like the United Kingdom, United States of America and China. India’s developments closely resonate with Beijing being the primary exporter of lithium to India[1]. Inflection points of investing into lithium stands in parallel with India’s self- sufficiency vision of Atma-nirbhar Bharat. Therefore, from 2019 India has adopted its mineral extraction strategic plan in order to comprehensively expand its reservoirs and military developments to counter the expansionary policies of China[2]. Breakthrough into the lithium reserves and development comes at the replacement of the traditional lead—acid batteries. Removing the constraints of speed and endurance, lithium has positive usage in military technologies. This has been the major reason upon which China has shaped its geopolitical and economical strategy to develop further commercial and scientific- technological developments with lithium[3]. New Delhi’s objective of harnessing lithium into defence and technological fields is in the development of its studies, information collection and bi- lateral connections to form new and major strategic alliances with the possibility of commercialization of lithium for future developments.
Implications of lithium- ion technologies, especially in the defence sector, are expected to provide a drastic shift in terms of performance and usage enhancement of military equipment. Narrative of change has been witnessed when the lithium industry saw a reduction in energy cost from USD 1000/kWh in 2010 to USD 200/kWh in 2020[4]. As the technology industry giants Apple and QuantumScope are procuring lithium reserves, in 2022, prices are expected to drop by USD 100/kWh[5]. Availability of high- density energy sources with better power performance and substantial developments in the safety and reliability of lithium batteries, adapting lithium batteries will not be restricted only to electronic devices. Military vehicle battery market is seemingly having rapid developments on this forefront[6]. Modern lithium rechargeable technology standardized for armoured and military vehicles requires the usage of premium minerals to mark a trajectory from lead-based batteries. Majority of military vehicles are still equipped with lead/acid batteries which date back to 50-year-old technology[7]. Lithium reserves have allowed the globe to enter a “new-energy economy”. New Delhi’s bi-lateral trade agreement signed with Australia in June 2020, has allowed it to enter the lithium economy[8]. Focusing on the trade, investment and research material such as lithium and cobalt, key technological development in military bases and cyber security is being targeted on a mutual basis[9]. This trajectory was also pursued by Australia by signing its own bi-lateral trade agreements with the United States of America in 2019[10]. Canberra provides that potential of becoming a primary supplier of cobalt and zircon to India, and fulfils an essential goal New Delhi is trying to pursue alongside QUAD. Trading with one of the top 3 suppliers of critical minerals, Indian Government’s policies such as the Make in India’ Program and its goal of using fully electric vehicles by 2030, expected to expand its manufacturing capabilities. This scramble to acquire critical minerals (Lithium, Cobalt and Zircon) is essential to overtake China, which already has a substantial lead in the race. And having no known source of lithium and cobalt in the subcontinent, its critical to follow these trade agreements and currently the best way to challenge the strategic supremacy of Beijing. In the past, a similar model was used in order to acquire the iron ore assets in Hajigak, Afghanistan[11]. The model prescribed a joint venture and partnership involving state and private actors and focused solely on the trade investments. Model deemed to become a failure due to lack of focus on security concerns.
Situation of Indian reserves of lithium and other premium minerals stands at a critical position. As per Atomic Minerals Directorate- India’s Atomic Energy Commission, estimated lithium reserves have been surveyed in Madya, 100 km from Bengaluru[12]. Journal of Current Science estimates that the areas consist of 14,100 tons of lithium. But the reserves are substantially lower than in the South America Countries[13]. The visit to the “Lithium Triangle”- Chile, Argentina and Bolivia - by Niti Aayog and Khanij Bidesh Ltd. (KABIL consortium), with bilateral success with Chile and Bolivia[14]. As per estimation, India’s requirement of lithium is expected to be 350,000 tons per year, along with the companies like Suzuki India plans to manufacture lithium- ion batteries in India[15]. Currently, over 33 billion Lithium- ion batteries are used by countries like China, Japan, South Korea, Taiwan, United Kingdom and United States of America being the major manufactures[16]. India’s current 1 billion use is limited to mobiles and laptops. The status quo compels India to import 100 percent of its Li- ion batteries and tapping into reserves would reduce the costs by a substantial margin. This target would move towards self- reliance to meet defence requirements and to cut dependence of Chinese imports, setting up to be its biggest strategic rival in global affairs. Central Electrochemical Research Institute (CECRI) in Karaikudi, Tamil Nadu has already set up its first indigenous Lithium- ion fabrication facility[17]. The facility has the potential to develop advanced applications in defence, solar powered devices, railways and other high-end usages to which the relations with Lithium Triangle will allow them to make the necessary advancements. And investment in CECRI is already a big attraction at international forums. Canadian based investors are seeking to establish facilities alongside CECRI, and the potential is that CECRI seeks to produce advanced solar powered batteries to harness solar energy at the most efficient level[18]. Bi-lateral relations among the Lithium Triangle was initiated in 2019 when the President of India travelled to Bolivia and Chile to target the goal of producing Electric Vehicles by 2030[19]. KABIL consortium was formulated by the government comprising of- National Aluminium Company (NALCO), Hindustan Cooper (HCL) and Mineral Exploration Corp Ltd. (MECL), with equity participation of 40:30:30. KABIL consortium has also been able to successfully build partnerships with mineral- rich countries such as Australia and in Africa and recently in South America[20]. Partnership with Bolivia and Chile prove to be of critical juncture. Bolivia has exported USD 0.561 million of Lithium Carbonate to the world in 2018[21]. USD 0.491 million and USD 0.161 million respectively in 2017 and 2016, out of which a total of USD 0.35 million goes to China and USD 0.22 million goes to the USA. Chile currently holds the world’s largest lithium reservoir. USD 948. $35 million value of Lithium Carbonate to the world in 2019, a substantial leap since USD 694.31 million in 2018 and USD 499.06 million in 2017[22]. For Chilean Lithium Carbonate, Republic of Korea, Japan and China are the top three importers with USD 340 million, USD 908.14 million and USD 128 million respectively in 2019[23]. A MoU signed with Argentina in July 2020 provides major strategic advantage over China in terms of having a plus importer of lithium. Provinces of Catamarca, Salta and Jujuy, have the most valuable quantity and quality of lithium[24]. Surpassing a 128 million tons of lithium carbonate, Buenos Aires holds the world’s third largest reservoir of lithium. 67% of lithium reserves, about half of the global offer, is concentrated in South America[25]. This implication proves to be qualitatively advantageous on a paramount scale. Commercial link and scientific- technological development in the field of lithium will allow India to challenge China and its expansionary policies.
Along with India’s 2030 target of conversion of all vehicles into electric platforms, Indian Navy and DRDO’s collective goal to upgrade its submarines involve an extensive usage of lithium. The Indian Navy seeks to lead its non- nuclear submarine program into a new age. Current Request for Information (RFI) document 05/01/2021 plans to develop a high- capacity lithium- ion battery system which is capable of being refitted to in- service submarines[26]. Defence Research and Development Organisation (DRDO) has been progressing towards a fuel cell system for the Indian Navy which involves phosphoric acid as an electrolyte reacting with hydrogen and liquid oxygen to generate electricity[27]. Indian Navy and Defence Research and Development Organisation (DRDO) are progressing towards increasing the endurance of its current submarines and future developments, battery systems which are not even in use in the Vikrant class. If the lithium-ion batteries are a success, then the need for AIP would be negated. Substantial improvement in the underwater endurance will provide inherent advantages of higher power density, lighter weight and lower maintenance costs. Primary difference is that lithium- ion batteries tend to keep their output high even when their charge level is low. On the contrary, lithium- ion batteries are exceptionally fast in charging and can store much more energy than lead based batteries. Currently employed AIP system batteries provide higher charger for higher output, due to the fact speed and dash capabilities of submarines tend to be slower. Example of lithium-ion batteries being substantially advantageous was witnessed when Japan commissioned the Ouryu in October 2020, the first ship of a class of seven submarines running on lithium- ion batteries. Alongside with India, South Korea is currently targeting to use lithium- ion batteries by 2026, establishing a narrative of major nations projecting towards the implementation of advanced battery systems in submarines.
Suffice to say that the upcoming trajectory in defence and technology will be based on lithium reserves. India’s plan of action to counter the Chinese strategy will rely on its utilization of lithium and maintaining its bilateral relations with the Lithium Triangle. Even though Australia has also become a part of New Delhi’s venture, strategic implication will only depend in terms of DRDO’s and CECRI development programs. Lithium has already shifted certain tangents in the global order. Lithium has fuelled the interest in mining in Bolivia, Chile and Argentina. Economic offense against China, strategic developments to counter the Chinese influence in oceans and venture of KABIL to establish a pact with South America represents the idea that India tends to pursue international relations. The idea of hegemony and diplomatic contest is not limited to economics and political ideologies. Influence can very much be measured on the idea that whether these nations are able to utilize the available resources to pursue the status quo technological developments. It is imperative for New Delhi to not let the lithium acquisition plan of action to not become a failure like the iron ore venture into Afghanistan.
Lithium exports are expected to be worth USD 3 billion by 2024- 2025 and this growth will not be limited to electronic developments[28]. If successful, India’s domestic priority of self- sufficiency and the Make in India program would actualize its potential and counter the Chinese
narrative.
Notes
[1] Siddiqui, H. (August 1, 2020). “India seeks FTA’s with countries that can support “Atmanirbhaar” journey in EV’s”. Financial Express.
[2] (January 20, 2019). “ISRO selects 10 firms for transfer of Lithium- ion technology”. Business Standard, Financial Express.
[3] Op. Cit, ibid.
[4] (October 30, 2020). “Why is Indian Navy eyeing Lithium- ion batteries for its submarines.” Financial Express
[5] Ibid.
[6] Frisch, F (August 24, 2017). “Battery Technology transforms the Defense Industry”. Epsilor.
[7] Ibid.
[8] (June 5, 2020). “Australia and India sign joint deal on critical minerals like Lithium”. Economic Times, ET Auto.
[9] Ibid.
[10] Ibid.
[11] Majumdar, R (July 6, 2018). “India reaches its prospects as hunt begins for lithium and cobalt mines abroad”. Economic Times
[12] Sasi, A (January 11, 2021). “Looking for lithium toehold, India finds a small deposit in Karnataka”. Indian Express.
[13] Ibid.
[14] Siddiqui, H (December 14, 2020). “India to tap ‘Lithium Triangle’ for Lithium- ION batteriers onboard Indian Navy Submarines”. Financial Express
[15] Op (Majumdar,R).ibid.
[16] Siddiqui, H (July 13, 2020). “South- South Cooperation: India and Argentina ink a strategic on Lithium”. Financial Express
[17] Siddiqui, H (October 30, 2019). “Niti Aayog travels to ‘Lithium Triangle’ to review possibilities for Lithium mining and exploration.”. Financial Express
[18] Ibid.
[19] Op. Cit, ibid.
[20] Sayal, R (February 18, 2020). “Reserves of Lithium, critical for EV batteries, found near Bengaluru: Report”. Livemint.
[21] (June 5, 2020). “Australia and India sign Joint Declaration on critical minerals like Lithium”. Economic Times, ET Auto.
[22] Ibid.
[23] Ibid.
[24] Siddiqui, H (July 13, 2020). “South- South Cooperation: India and Argentina ink a strategic on Lithium”. Financial Express
[25] Ibid.
[26] (October 30, 2020). “Why is Indian Navy eyeing Lithium- ION batteries for its submarines”. Economic Times.
[27] Ibid.
[28] Siddiqui, H. (August 1, 2020). “India seeks FTA’s with countries that can support “Atmanirbhaar” journey in EV’s”. Financial Express.
Pic Courtesy- Kumpan Electric at unsplash.com
(The views expressed are personal.)
