In a strategic move to counter China’s growing influence in critical mineral supply chains, India and the United States have signed an agreement to bolster their collaboration in this vital sector. This agreement comes in response to China’s recent export restrictions on key minerals like gallium and germanium, which are essential for the semiconductor industry and rare earth magnet production.
The memorandum of understanding (MoU), signed by India’s Minister of Commerce and Industry Piyush Goyal and US Secretary of Commerce Gina Raimondo, focuses on diversifying critical mineral supply chains and reducing dependency on China. The partnership seeks to promote open and resilient supply chains, support green energy initiatives, and enhance technology development between the two nations.
India’s Production Linked Incentive (PLI) schemes have already seen investments of over $4.5 billion to boost clean energy production. However, both nations acknowledged the need for additional policies to protect these investments from market volatility. In particular, India has been affected by China’s control over the supply of solar equipment, prompting the reinstatement of the Approved List of Models and Manufacturers (ALMM) order, which restricts the use of Chinese-made solar modules in domestic projects.
The agreement also emphasizes the inclusion of mineral-rich countries, particularly in Africa and South America, to ensure a sustainable and diverse supply chain. As India strengthens its clean energy manufacturing capabilities, this partnership with the US is seen as a critical step toward building long-term resilience in the critical minerals sector.
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