India and Australia eye stronger ties in critical minerals field
- March 12, 2023
- Posted by: OptimizeIAS Team
- Category: DPN Topics
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India and Australia eye stronger ties in critical minerals field
Subject : Geography
Section: Economic geography
Concept :
- Minister of Commerce and Industry Piyush Goyal and his Australian counterpart Don Farrell announced the formal resumption of negotiation for the Comprehensive Economic Cooperation Agreement (CECA) which will cover a “much wider” area of commercial cooperation.
- Ministers from the two countries have also agreed to deepen cooperation and extend their existing commitments to the India-Australia Critical Minerals Investment Partnership.
- Australia confirmed that it would commit USD 5.8 million to the three-year India-Australia Critical Minerals Investment Partnership.
Critical Minerals
- Critical minerals are elements that are the building blocks of essential modern-day technologies, and are at risk of supply chain disruptions.
- These minerals are used everywhere from making mobile phones, computers to batteries, electric vehicles and green technologies like solar panels and wind turbines.
- It mostly includes graphite, lithium and cobalt, which are used for making EV batteries; rare earths that are used for making magnets and silicon which is a key mineral for making computer chips and solar panels.
Why is this resource critical?
- As countries around the world scale up their transition towards clean energy and digital economy, these critical resources are key to the ecosystem that fuels this change.
- Any supply shock can severely imperil the economy and strategic autonomy of a country over-dependent on others to procure critical minerals.
- But these supply risks exist due to rare availability, growing demand and complex processing value chain.
- Many times, the complex supply chain can be disrupted by hostile regimes, or due to politically unstable regions.