New Delhi – Union Minister Ashwini Vaishnaw participated in a crucial multinational meeting in Washington on Monday, joining finance ministers from 10 countries to discuss strengthening critical minerals supply chains. The gathering, hosted by US Treasury Secretary Scott Bessent, focused on addressing growing concerns over China’s overwhelming dominance in the sector and the urgent need for diversification.
The high-level meeting included representatives from G7 nations, Mexico, and the European Union, with officials indicating that discussions laid essential groundwork for possible future collaborations in critical minerals supply chains development.
China’s Dominant Position Raises Alarm
Washington emphasized the necessity for “prudent derisking” during the discussions on critical minerals supply chains, expressing serious concern that global supply chains have become increasingly vulnerable to disruption and manipulation due to excessive concentration in a few geographies. This reference directly pointed to China’s commanding position in the sector.
China currently leads production of 30 minerals deemed critical by the US Geological Survey and accounts for approximately 70% of rare earths mining globally. Even more concerning, China controls over 90% of processing capacity worldwide, giving it unprecedented leverage over critical minerals supply chains that are essential for modern technology and defense applications.
Shared Commitment to Address Vulnerabilities
According to the US Treasury Department’s readout, “Throughout the course of discussions, attendees expressed a strong, shared desire to quickly address key vulnerabilities in critical minerals supply chains. The United States highlighted actions and investments it has already undertaken, as well as planned steps to create resilient, secure, and diversified critical minerals supply chains.”
This unified approach reflects growing international recognition that dependence on a single nation for critical minerals supply chains poses significant economic and national security risks that require immediate coordinated action.
Impact on India’s Manufacturing Sector
Following the meeting, Vaishnaw took to social media platform X to emphasize the importance of strengthening critical minerals supply chains for India’s economic development. He specifically highlighted how robust critical minerals supply chains would significantly aid India’s manufacturing capabilities and electronics sector, both of which are priority areas for the nation’s economic growth strategy.
The electronics sector, in particular, depends heavily on rare earth elements and other critical minerals for manufacturing semiconductors, batteries, displays, and various electronic components essential to modern devices.
Pax Silica Invitation Signals Deeper Cooperation
The gathering on critical minerals supply chains came as the United States prepares to invite India to join Pax Silica, its flagship initiative for building secure supply chains for semiconductors, AI technology, and critical minerals. US ambassador-designate Sergio Gor announced in New Delhi on Monday that India would be invited to join the grouping as a full member next month.
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Pax Silica currently includes Japan, South Korea, and the UK, and India’s inclusion would mark a significant expansion of this strategic initiative aimed at creating alternative critical minerals supply chains independent of Chinese dominance.
Existing India-US Minerals Cooperation
India and the United States have already established a foundation for collaboration on critical minerals supply chains. In October 2024, the two countries signed a memorandum of understanding specifically focused on strengthening critical minerals supply chains cooperation and coordination.
Additionally, both nations launched the Strategic Mineral Research Initiative, which aims to recover and process lithium, cobalt, and rare earths from industries such as aluminum, coal mining, and oil and gas. This initiative represents an innovative approach to developing domestic critical minerals supply chains through recycling and extraction from existing industrial processes.
Minerals Security Partnership Membership
In 2023, India joined the US-led Minerals Security Partnership, demonstrating its commitment to developing robust critical minerals supply chains. This 14-nation grouping, which includes the European Union, was formed specifically to catalyze investments to build “robust, responsible critical minerals supply chains to support economic prosperity and climate objectives.”
The partnership provides a framework for member nations to coordinate investments, share technology, and develop alternative sources for critical minerals supply chains outside of Chinese control.
High-Level Scientific Collaboration
Vaishnaw, who returned to India on Monday evening, also met with Michael Kratsios, director of the White House’s office of science and technology policy and Trump’s top science adviser. This meeting underscores the scientific and technological dimensions of critical minerals supply chains development.
Kratsios is scheduled to attend the India AI Summit in February, suggesting that discussions on critical minerals supply chains will continue in the context of artificial intelligence development, where rare earth elements and specialized minerals play crucial roles in hardware manufacturing.
Strategic Importance for National Security
The focus on critical minerals supply chains extends beyond economic considerations to encompass national security concerns. Modern defense systems, renewable energy technologies, electric vehicles, and advanced electronics all depend on reliable access to critical minerals, making supply chain resilience a matter of strategic importance.
Future Outlook and Cooperation
The Washington meeting on minerals supply chains represents a significant step toward creating a more diversified and resilient global supply network. As nations recognize the risks of over-dependence on single sources, collaborative efforts to develop alternative critical minerals supply chains will likely intensify, with India positioned to play an increasingly important role in this strategic sector.
