Context: The first Lithium refinery of India is to be set up in Gujarat. One of the largest power trading and renewable energy company, Manikaran Power Limited is to invest Rs 1000 crores to set up the refinery.
About the Refinery

• The lithium ore for the refinery is to be imported from Australia.

About the companies

• The Neometals (an Australian firm) and Manikaran have entered in to agreement to produce lithium in India. The future demand of Lithium in India is driven by the electrification of transport and storage of renewable energy. Manikaran is India’s third largest power trading company.

Background

• Lithium is a rare element and is not found in India. India gained access to the Bolivian Lithium reserves very recently. India has set an ambitious goal of increasing the Electric Vehicle numbers to 30% by 2030. However, India is importing all the lithium required to make lithium-ion batteries.
• India is currently dependent on China, Japan and Taiwan for its electrical batteries as lithium in India is highly expensive.

Key Points

• Lithium is a rare element not usually found in India.
• The company will be importing Lithium ore from Australia and will be processing it here.
• Last year, Manikaran Power had collaborated with Australian firm Neometals to tap the Mount Marion Lithium mine in Western Australia.
• The proposed project is expected to help Gujarat secure the raw material supply for domestic manufacturing of Lithium batteries as it looks to promote electric vehicles.
• There are already a few Lithium ion battery manufacturing plants which are being set up in Gujarat.

India and Bolivia

• In April 2019, India and Bolivia signed an agreement, under which Bolivia will supply Lithium Carbonate to India. Bolivia has one-fourth of the world lithium reserves. However, the country has not yet begun commercial production. The agreement will act as a backbone for FAME-Faster Adoption and Manufacture of Hybrid and Electric vehicles.

China- the current leader

• China controls 51% of global lithium and 62% of cobalt. These two elements are the main components of lithium-ion batteries. 
• Most of the lithium for the Chinese market comes from the South American Lithium Belt. This is a 500-mile by 200-mile north-south strip and is centred on the junction of Bolivia, Argentina and Chile. The belt holds more than 75% of world Lithium reserves.

Top Lithium producers

• The top Lithium producing countries in the world are Australia, Chile, China, Argentina, Zimbabwe and Portugal.