US, India moving very close to finalising critical minerals agreement: Envoy Sergio Gor
US Ambassador to India Sergio Gor announced at the India Today Conclave 2026 that the United States and India are "moving very close" to finalising a critical minerals agreement, with a "major announcement" expected within months
The agreement aims to secure supply chains for critical minerals essential to advanced manufacturing, clean energy systems, semiconductors, electric vehicles, and emerging technologies
Commerce and Industry Minister Piyush Goyal indicated simultaneously that an interim bilateral trade agreement between the two nations is likely to be signed within the month
The minerals pact is positioned as an alternative to dependence on China, which currently dominates global processing of many critical minerals despite not always being the primary miner
Gor stated that reliable and diversified supply chains for critical minerals are essential to both economic growth and national security, and that these materials must "never be used as leverage" against partner economies
Critical Minerals: Definition, Significance, and Global Supply Chains
Critical minerals are raw materials considered economically and strategically vital for a nation's economy and security but subject to supply chain vulnerability. The US Department of Energy and the Indian Ministry of Mines both maintain national critical mineral lists. The commonly identified minerals include lithium, cobalt, nickel, rare earth elements (REEs), graphite, manganese, and titanium — materials essential to batteries, semiconductors, defence systems, solar panels, and electric motors. China's dominance is structural: it processes approximately 60% of the world's lithium, over 80% of rare earth elements, and 50–60% of cobalt, even when ore originates elsewhere.
Key Details
- India's Critical Minerals List (2023): 30 minerals including lithium, cobalt, nickel, REEs, graphite, germanium
- India has significant domestic reserves of REEs (estimated world's 5th largest), lithium (Salal, Jammu; Ananta, Rajasthan), and titanium
- The Khanij Bidesh India Ltd (KABIL) was established in 2019 to acquire critical mineral assets overseas
- The Minerals Security Partnership (MSP), launched by the US in 2022, coordinates supply chain diversification among 14 partner countries including India
The US-India critical minerals agreement would formalise a bilateral framework within the broader MSP architecture, potentially including joint investment in mineral processing, technology transfer for battery-grade refinement, and co-investment in overseas mining projects.
The India-US Trade Architecture: From GSP to an Interim Deal
Trade relations between India and the US have been managed through a patchwork of arrangements rather than a comprehensive free trade agreement (FTA). The US terminated India's Generalized System of Preferences (GSP) benefits in 2019 under the Trump 1.0 administration, citing market access barriers. Negotiations under TIFA (Trade and Investment Framework Agreement) have proceeded intermittently. The current bilateral trade volume is approximately $190 billion annually (FY2024), with India running a trade surplus of about $45 billion. The interim deal now under negotiation represents the most structured trade framework proposed between the two countries.
Key Details
- India's GSP benefits terminated: June 2019 (covering ~$5.6 billion in annual exports)
- TIFA signed: 2000; TIFA Joint Commission meets periodically
- US tariffs on Indian goods under Section 232: steel (25%) and aluminium (10%) still in place
- India's trade surplus with the US (FY2024): approximately $45 billion
- Modi-Trump February 2025 meeting commitments: India to buy $500 billion of US goods; reduce duties on American products; reduce Russian oil purchases
The critical minerals agreement is proceeding within a broader bilateral context of accelerated economic negotiations, where both sides see strategic value in reducing dependence on Chinese supply chains and formalising a deeper economic partnership.
Mineral Security and India's Atmanirbhar Bharat
India's Atmanirbhar Bharat (Self-Reliant India) initiative, launched in 2020, explicitly included critical mineral security as a priority. The National Mineral Exploration Trust (NMET) has been expanded, deep-sea mining rights were acquired, and the Mines and Minerals (Development and Regulation) Amendment Act 2021 enabled private-sector entry into previously state-reserved mineral blocks. India's Production Linked Incentive (PLI) schemes for advanced chemistry cell batteries and solar modules have increased demand for critical minerals domestically, strengthening the policy case for secure international supply agreements.
Key Details
- MMDR Amendment Act 2021: expanded auction of atomic mineral blocks; allowed private participation in over 500 minerals
- PLI scheme for ACC (Advanced Chemistry Cell) batteries: ₹18,100 crore outlay to build 50 GWh capacity
- KABIL's first overseas MoU: lithium, cobalt blocks in Australia and Argentina
- India's National Critical Mineral Mission: announced in Budget 2024-25 to boost domestic exploration and processing
The US-India critical minerals agreement would complement India's domestic push by providing assured access to mineral processing technology and co-investment frameworks, reducing the risk of supply disruptions in key technology sectors.
- India-US bilateral trade: approximately $190 billion annually (FY2024)
- India's trade surplus with the US: approximately $45 billion (FY2024)
- China's share of global REE processing: over 80%
- China's share of global lithium processing: approximately 60%
- India's Critical Minerals List: 30 minerals (revised 2023)
- Minerals Security Partnership members: 14 countries including India and the US
- KABIL established: 2019 (joint venture of NALCO, HCL, MECL)
- PLI for ACC batteries: ₹18,100 crore outlay for 50 GWh capacity