India-Chile FTA ‘must cover mines acquisition, key mineral import’
The deal could be on the lines of one signed with Argentina, say government sources
The Mines Ministry has suggested that the discussions on India–Chile Free Trade Agreement (FTA) must cover securing of critical minerals, acquisition of copper and lithium mines and commercial otake agreements at the G2G (government -to- government) level, an ocial aware of the matter told businessline.
Currently, both countries have a preferential trade agreement (PTA), which is a limited trade arrangement, and not an FTA.
G2G AGREEMENTS
A delegation of industry and government ocials had recently visited Chile to explore scope of larger economic cooperation,
A delegation of industry and government ocials had recently visited Chile to explore the scope of larger economic cooperation, including critical mineral partnerships
including securing critical mineral partnerships.
Previously, the Mines Ministry signed a non-disclosure agreement with ENAMI, the state-owned company of Chile, for exchange of information
and data sharing. “So, we are looking at G2G agreements for exploration, acquisition of mineral blocks and subsequent otake of these critical minerals – if exploration activities are successful. In this case, the mineral blocks under-discussion is that of copper and lithium. These agreements could be on the lines of what we had done in case of acquiring lithium blocks in Argentina,” the ocial said. Earlier this year (in January), India made its first ever acquisition of lithium blocks overseas, in Argentina. Five blocks were acquired through the state-run entity, KABIL or Khanij Bidesh India Ltd - a JV of NALCO, Hindustan Copper and MECL. Around ₹200 crore will be invested towards exploration and other mining activities there, over a fiveyear-period.
LITHIUM TRIANGLE
Chile, along with two other LatAm nations, Argentina and Bolivia, form the world’s Lithium Triangle, accounting for majority of the resources globally. Lithium, also called white gold, is pivotal for usage in EVs (electric vehicles), batteries – mobile phones and cars, and other energy storage solutions. It is the cornerstone of India’s transition to green energy. The country is dependent on imports.
On the other hand, copper, is also identified as a critical mineral in India, and finds widespread usage in power cables, wind turbines, electric vehicles and solar panels. Copper demand, including its price movement, is seen as a key indicator of economic health.
“Our suggestions to the Commerce Ministry have been to include discussions on critical minerals, specially copper and lithium, in the FTA talks with Chile,” the official said.