Power, Buried Deep: The India–US Critical Minerals Pact and the Geopolitics Beneath the Surface

For much of modern history, nations measured strength through military capability, oil reserves, manufacturing output or financial influence. A quieter metric is now entering the centre of geopolitical calculation in the shape of critical minerals.

Civilisations once rose around rivers. Modern economies are rising around mineral corridors. This reality sits beneath the new India–US critical minerals agreement signed in New Delhi by External Affairs Minister Dr S Jaishankar and US Secretary of State Marco Rubio. The framework, focused on securing supply chains for critical minerals and rare earths across mining, processing, recycling, financing and resource management, may appear technical. It is anything but.

At one level, it extends commitments forged during Prime Minister Narendra Modi’s Washington visit earlier this year. At another, it reveals a broader shift underway in global politics where the world’s leading powers are beginning to organise themselves around access to the materials that power batteries, semiconductors, artificial intelligence systems, clean-energy infrastructure and advanced defence manufacturing. According to many experts, the recently concluded pact between Washington and Delhi looks less like an industrial cooperation and more like geopolitical insurance.

The wars of the future may begin not with gunfire, but with shortages. Shortages of lithium for batteries, rare earths for chips, and the critical minerals without which modern civilisation flickers, slows, and risks grinding to a halt.

The New Currency of Power Lies Underground

For much of modern history, nations measured strength through military capability, oil reserves, manufacturing output or financial influence. A quieter metric is now entering the centre of geopolitical calculation in the shape of critical minerals.

Critical minerals have become indispensable to the technologies driving the twenty-first-century economy. Electric vehicles cannot scale without lithium and nickel. Renewable energy systems depend on mineral-intensive infrastructure. Semiconductor manufacturing and AI hardware require tightly interconnected supply ecosystems built on rare earths and processed metals.

US Secretary of State Marco Rubio and Indian EAM S Jaishankar

Demand keeps rising. Lithium demand surged by nearly 30 percent in 2024 alone. Nickel, cobalt, graphite and rare-earth demand also climbed steadily, propelled largely by battery manufacturing and clean-energy deployment. Nearly 85 pe cent of recent growth in battery metals came from the energy sector.

The devices shaping everyday life are becoming reminders that modern prosperity still depends on what the earth is willing and geopolitics is able to supply.

When Supply Chains Became National Security

Markets preach openness until strategic minerals enter the conversation.

For decades, globalisation rewarded efficiency and production concentrated where costs were lowest. Nations accepted deep interdependence as the price of economic growth until a succession of shocks changed the political mood.

During the pandemic era, semiconductor shortages rippled through industrial economies with astonishing force. Carmakers across the United States, Europe, Japan and India cut output or paused factories altogether. Ford, Toyota and General Motors were reminded that billion-dollar manufacturing ecosystems could be disrupted by the scarcity of tiny chips embedded within narrow supply chains.

Governments drew a sobering conclusion that advanced economies could be paralysed not only by conflict, but by fragile industrial dependencies.

The world had already witnessed an earlier warning.

In 2010, a maritime dispute between China and Japan near the Senkaku and Diaoyu Islands produced a lesson the world has not forgotten. Beijing reportedly restricted rare-earth exports to Japan, whose industries depended heavily on those supplies for electronics, automobiles and advanced manufacturing. The alarm spread well beyond Tokyo. Governments suddenly saw how easily mineral dependence could harden into geopolitical vulnerability.

Japan reacted with unusual urgency and diversified its suppliers, invested aggressively in recycling, and backed overseas rare-earth ventures, including Australia’s Lynas operations. The episode changed how states thought about supply chains themselves.

China currently accounts for around 80 percent of processed cobalt and nearly two-thirds of refined lithium globally, and such concentration certainly impedes global balance. In sectors tied to technology leadership, industrial resilience and national security, it becomes a strategic dilemma.

India’s Industrial Ambition Needs More Than Mineral Discovery

US Secretary of State Marco Rubio and Indian Prime Minister Narendra Modi

For India, the agreement’s significance stretches far beyond access to raw materials. New Delhi wants to emerge as a manufacturing, technology and clean-energy power. Yet industrial transformation requires more than discovering deposits beneath domestic soil.

The harder challenge lies in refining, processing, recycling, financing and downstream manufacturing. Value does not primarily accrue to those who merely extract resources; instead, it flows toward those who master industrial ecosystems around them. India has begun moving in that direction.

Domestic exploration has expanded sharply. Geological Survey of India projects focused on critical minerals have increased from 59 in 2020–21 to well over 120 annually in recent years. The establishment of Khanij Bidesh India Ltd., or KABIL, reflected another strategic recognition. Securing overseas access to lithium, cobalt, and other strategic minerals could no longer remain a peripheral exercise for India.

The new framework aims to actualise these ambitions. Battery manufacturing, semiconductor production, electric mobility, renewable technology and advanced defence systems all depend on stable mineral-linked capabilities. By integrating more deeply into trusted supply networks, India gains an opportunity to climb higher up the industrial value chain rather than remain primarily a large consumer market. Its geopolitical leverage rises alongside its industrial capabilities.

As global supply chains reorganise around resilience and trust, India’s value increasingly lies not only in diplomacy or market size, but in its potential to become a full-spectrum industrial partner inside the Indo-Pacific.

Washington’s Diversification Strategy Has a Missing Piece

The agreement is also the product of Washington’s growing recognition that diversifying supply chains and reducing structural vulnerabilities cannot be achieved through transactional partnerships alone. The effort requires dependable partners with industrial scale, technological ambition, demographic depth, and long-term strategic compatibility. Few countries fit that profile.

The US government has already mobilised more than USD 30 billion through loans, investments, letters of interest and related support mechanisms aimed at strengthening critical-minerals supply chains in partnership with private industry. 

Meaningful diversification without India would remain incomplete, as it brings together manufacturing potential, technological capacity, market scale and advantageous Indo-Pacific geography in a way few countries can match. Unlike smaller resource-rich states, it possesses the possibility of evolving into a complete mining-to-manufacturing ecosystem.

The India-US bilateral framework also sits within a wider strategic architecture. Signed alongside Quad diplomatic engagements, it aligns with a broader push involving India, the United States, Japan and Australia to strengthen secure, diversified and resilient mineral supply chains across the Indo-Pacific.

International politics is slowly evolving beyond traditional alliance models.

Military partnerships still matter, but resource and technological alliances are becoming equally consequential.

The Geopolitics of the Green and Digital Future

The clean-energy transition cannot sustainably depend on excessively concentrated mineral supply chains. Neither can the semiconductor race or artificial intelligence. Diversification, therefore, is no longer simply an economic preference but a doctrine of economic sovereignty.

The India–US critical minerals pact is best understood within that larger transformation, as it is part of a broader contest over who builds the industrial foundations of the future and who remains vulnerable to someone else’s choke points.

Economic sovereignty now begins deep beneath the earth’s surface. Countries that recognise this shift early will shape the industries, technologies and strategic balances of tomorrow. Those that fail may discover that modern dependence does not always arrive through sanctions, tariffs or military coercion. Sometimes it comes quietly, embedded in a battery cell, hidden inside a semiconductor wafer, or threaded through supply chains that stretch silently across continents.