Strategic Minerals is a broad-based category that constitutes various minerals and elements such as Tin, Cobalt, Lithium, Tungsten etc. The notion of strategic material could differ for every country depending on its needs and nature of mineral deposits available.

Certain minerals are considered as strategic because of following reasons:

• Their substitutes are limited or lead to a loss of properties and are often subject to the same constraints (e.g. production is concentrated in a few geographies).
• Potential for accelerating their production/supply is very limited as many of these can only be produced as a by-product of base metals extraction
• There is a swift increase in their demand because these are key inputs for metal intensive technology such as hi tech defence applications, hybrid cars etc. & dependence on these technologies is increasing worldwide.

As India aspires to establish and strengthen its own high-tech industry base to ensure & sustain growing industrialization, it is important for India to selectively focus on sustained supply of such strategic materials. At present, India is dependent on imports to a large extent and is thus vulnerable to supply/price fluctuations.

Challenges for India in exploration and production:

1. Current understanding and knowledge of these minerals is limited and thereby India remains exposed to sub-optimal responses to the strategic risk.
2. The notion of „strategic minerals? is relatively new to policy makers in India as compared to other major economies of the world. Thus, limiting the scope for cross-cutting analysis and policy-making.
3. Inconsistent mining regulations, legislative regimes and environmental risks for many of these minerals
4. Besides non availability of some strategic minerals, there are technological challenges associated with the exploration of available minerals such as polymetallic nodules.
5. Investment is not incentivised as in other countries. Thus, investors find it non-profitable venture as extracting such minerals usually is complex and technology intensive.

Potential approach for India may include:

• Access to raw materials in world markets: Entering into bilateral agreements with mineral rich countries, to secure supply for both the short term and long term requirements.
• Framework to foster sustainable supply from Indian sources: Incentivising domestic producers to produce these metals through relevant fiscal measures.
• Increase resource efficiency and promoting recycling: Investing in research so that substitutes can be found. Recycling can also help meet a part of the demand of these metals.
• Build a national stockpile: to meet supply in case of exigencies & keep prices under control.