The International Energy Agency (IEA) has raised concerns over the rising concentration of critical mineral mining and processing in a handful of countries, warning that such dependence could drive up global prices and disrupt supply chains. At the same time, the agency urged countries like India to accelerate the transition to green mobility to reduce vulnerability to oil price volatility.
Concentration of Supply Threatens Global Stability
IEA Executive Director Fatih Birol, after a meeting with India’s Commerce and Industry Minister Piyush Goyal, highlighted how the increasing geopolitical tensions are reshaping global trade dynamics.
Birol noted that global trade is entering a stage where countries no longer govern trade flows purely by WTO rules. He said a few regions now control most of the world’s critical minerals—essential for the energy transition, defense, AI, chips, and manufacturing—and called this a major concern.
He emphasized that China currently dominates both the mining and processing of key minerals like lithium. As global trade tensions rise, especially with the U.S. ramping up pressure on China, fears of supply disruptions and surging prices are growing.
Call for Global Diversification in Mining and Refining
Birol urged nations to diversify their sources of critical minerals. “The best energy security policy is diversification. Without it, we risk facing unintended consequences—like global supply shocks,” he cautioned. He called on countries to broaden their mining, refining, and processing operations to build more resilient energy supply chains.
India Should Incentivize EV Adoption
Responding to questions on electric vehicle (EV) incentives, Birol strongly recommended that oil-importing nations like India offer financial support to encourage EV uptake. “Electrifying mobility is not just about emissions—it’s about energy independence,” he said. “Countries should support consumers, especially for their first electric vehicle purchase. Incentives may vary in scale depending on each country’s fiscal capabilities, but the support is vital,” he added. He further mentioned that current low oil prices may not last, and EVs offer a long-term solution for countries looking to manage domestic fuel costs effectively.
Electric Vehicles: The Economic Advantage
Birol emphasized that EVs are already cost-competitive in many parts of the world. “In numerous countries, the upfront cost of electric cars is now similar to that of traditional vehicles. And in nearly all cases, driving a kilometer costs less with electricity than with oil—unless oil falls below $50 a barrel,” he mentioned. He confidently predicted that EVs will dominate the roads in the near future due to both economic and environmental advantages.
India’s Green Energy Push Praised
Birol lauded India’s progress on its clean energy transition, calling it a global model for sustainable growth. “India has transformed its energy investment landscape. Earlier, for every dollar invested in clean energy, there was an equal dollar for fossil fuels. Today, that ratio stands at $4 for clean energy for every $1 in fossil fuels. This is remarkable,” he said. He also praised key Indian initiatives such as Ujjwala, which has expanded access to clean cooking fuel, and the LED bulb campaign, which significantly reduced electricity consumption.
A Global Success Story in Sustainability
“India is a huge, huge, huge success story,” Birol concluded. “Its green transition is not just good for the Indian economy and energy security—it’s a boon for the world.” As reported by the economictimes.indiatimes.com, as global energy dynamics continue to evolve, India’s proactive policies and focus on renewable infrastructure place it at the forefront of the global sustainability movement.
