The vital minerals sector has attracted vital world consideration, together with from New Delhi and Astana. On November 4, India and Kazakhstan partnered to supply titanium slag, a vital mineral. Indian Uncommon Earths Restricted (IREL) and Kazakhstan’s Ust-Kamenogorsk Titanium and Magnesium Plant (UKTMP) have signed an agreement to ascertain an Indo-Kazakh three way partnership firm (JVC), IREUK Titanium Restricted, which is about to course of low-grade Ilmenite reserves in Odisha into high-grade titanium feedstock. UKTMP, apart from offering the know-how and capital funding, would additionally offtake agreed portions of titanium.
This initiative goals to develop the titanium worth chain inside India. In line with the official press launch, the association “shall be instrumental in bringing priceless foreign exchange for [India] and help UKTMP JSC in uncooked materials safety.” Synergizing the strengths of each side, the three way partnership is predicted to boost the model fairness of each corporations whereas serving as a hub for India and Kazakhstan within the titanium worth chain, aligning with the broader strategic aims of each side in securing vital mineral provide chains.
The brand new India-Kazakhstan titanium deal displays three essential features. First, the settlement represents a constructive but incremental improvement in India’s long-term aim of growing a vital minerals provide chain and a way to compensate for previous lapses. India’s makes an attempt to public sale off mining rights for vital minerals have obtained lackluster responses prior to now. Given the pricey extraction course of, Indian traders have been reluctant to speculate because of the outdated official useful resource classification guidelines, which lack the required data on the financial viability of mining a block. The Ministry of Mines (MOM), having didn’t obtain a minimal of three required home bidders on a number of events, has needed to scrap the auctioned mineral blocks. Within the third tranche of auctions, for instance, MOM annulled three out of the entire seven auctioned blocks – together with the one containing titanium.
Consequently, the take care of Kazakhstan will kind a key ingredient of India’s strategy to leveraging international know-how and capital for growing a vital minerals provide chain. This settlement is essential, given titanium’s application across key sectors and gaps in India’s supply chain. Owing to the lack of extraction, processing, and recycling applied sciences inside India, the nation stays excessively depending on imports. In processing particularly, India has considerable processing capabilities for just one designated vital mineral, copper. For all others, it’s reliant on exterior suppliers to supply refined minerals.
Second, the deal can also be a mirrored image of elementary politico-economic adjustments that Kazakhstan and the Central Asian area are witnessing. With over 5 % development from the final decade, the region has made significant strides in upskilling its labor power and bettering manufacturing capabilities whereas making an attempt sustainable financial development.
Not like earlier, when Indian power corporations similar to ONGC Videsh Ltd (OVL) bought stakes to discover and exploit Kazakhstan’s oil subject, at this time’s actuality is totally different. UKTMP, which sells 100% of its titanium merchandise to developed nations, is a testomony to the large technological progress that Kazakhstan has realized. Achieving over 4 percent growth since 2017, excluding the pandemic yr, Astana has adopted a market-driven innovation ecosystem, which has meant regional management in science, know-how, and innovation and competitiveness in a quickly evolving world technological panorama. The nation’s financial development trajectory seems brilliant, with its central bank forecasting a median development price of 4.5 % over a 5-year horizon.
Third, the deal may imply elevated focus in South Block on advancing India’s ties with Kazakhstan and probably the Central Asian area – a global mineral powerhouse. Moreover oil and uranium, Astana possesses large reserves of vital minerals and uncommon earth components, together with cadmium and rhenium, thought of vital by India.
Kazakhstan’s significance to India goes past possession of mineral assets, with Astana being New Delhi’s largest trading partner in Central Asia. Current talks between the 2 sides have emphasised higher business-to-business linkages and leveraging complementarities, significantly within the electronics and engineering items sector. The bilateral commerce, totaling $1 billion in 2023, has immense scope for development in a variety of sectors, together with energy, renewable power, prescribed drugs, and agriculture.
The potential of India’s ties to Central Asia stays unfulfilled. Regardless of its makes an attempt to pursue deeper strategic engagement, New Delhi’s hyperlinks with the area are restricted. India’s conventional coverage goal of realizing bodily connectivity by means of initiatives together with the Worldwide North-South Transport Hall (INSTC) and Chabahar port has remained elusive for two decades.
There appears to be a way gripping New Delhi that its earlier assumptions concerning the area – that Central Asian nations are predominant beneficiaries from bilateral engagement – now not stay legitimate. As we speak, it’s a brand new Central Asia, with its economies witnessing robust development charges and transitioning from inward orientation to liberalization, together with market diversification. There may be additionally a higher regional push towards diversifying worldwide companions. Amid renewed major power competition involving the US, China, and the European Union, India’s revived regional curiosity, underscored by the latest deal within the titanium sector, is emblematic of Central Asia’s elevated strategic utility.
Whereas India, understandably, can not present large-scale infrastructural investments on the identical scale as China, New Delhi is more likely to capitalize on the fresh engagement opportunities in the region stemming from the Russia-Ukraine struggle. With complementarities for regional engagement in sectors like mining, inexperienced power, medical tourism and training, and digital applied sciences, India’s makes an attempt to change into a viable alternate accomplice for Central Asian nations are more likely to proceed. That is evidenced by a latest 10-year agreement with Iran for operationalizing the Chabahar port and negotiations for a free trade agreement (FTA) with the Eurasian Financial Union (EAEU).
Concerning vital minerals particularly, however its partnerships with nations similar to the US, Australia, and France, India is more likely to discover additional engagement with Kazakhstan and presumably different Central Asian states. Since securing vital minerals provide chain throughout the spectrum from exploration to recycling stays a long-term and sophisticated aim, the extra, the merrier seems to be the mantra going ahead.
Subsequently, regardless of multifaceted impediments to substantive engagement, India’s perceptual shift and its curiosity in changing into a key regional actor would drive New Delhi to pursue deeper financial engagement with Central Asia.
