India's Copper Supply Challenge: Navigating the Path to 2035

As India strides toward its ambitious renewable energy targets, the critical role of copper in this transition cannot be overstated. Yet, the nation faces a series of daunting challenges that threaten its ability to meet soaring copper demand by 2035. Experts predict that India could experience substantial copper supply shortages in the coming years. Projections suggest that by 2035, the country may face a shortfall ranging from 1.6 million metric tons in a favorable scenario to nearly 10 million metric tons if current trends continue. Such gaps could have far-reaching implications for India's climate goals and infrastructure projects.

"India's renewable energy journey is intricately linked to securing a reliable copper supply. As we face the possibility of a significant shortfall by 2035, addressing this challenge is paramount to safeguarding our climate goals. Strategic partnerships, innovation in domestic exploration, and sustainable mining practices are essential to ensure long-term supply security. Omega Seiki Mobility understands the urgency to diversify supply chains and promote recycling, as copper is the linchpin of our electrification efforts. A resilient copper strategy will be the foundation for India's energy future."— Mr. Uday Narang, Founder and Chairman of Omega Seiki Mobility.

India's reliance on imported copper is a pressing concern. By 2035, it is estimated that the country will need to import 67% of its refined copper, underscoring the urgency to diversify its supply chains. Establishing strategic partnerships with major copper-producing countries is essential for bolstering India’s supply security.

Another hurdle is the lengthy timeline associated with developing new copper mines. Typically, it takes about 16 years to bring a new mining project to fruition. As a result, any initiatives launched today will not alleviate supply issues until well after the expected surge in demand. India must focus on enhancing domestic exploration and adopting sustainable mining practices to ensure a stable copper supply.

The current mining and processing infrastructure in India is not adequately equipped to ramp up production quickly. Significant investments are required to modernize and expand facilities, ensuring they can meet the rising demand for copper in the coming years.

Private and public players are crucial to enhancing India's copper supply chain amid rising demand for infrastructure and renewable energy. Vedanta aims to capture 45% of the domestic market by 2030, while Adani Group plans to produce 1 million tonnes of refined copper annually at its new plant in Gujarat. Hindustan Copper Limited (HCL) also seeks to triple its output by 2029. Together, these efforts, supported by government reforms, will help India achieve self-reliance in copper production and reduce import dependence. Also, the government should boost copper production by adding new capacities and reviving idle plants.

While recycling can play a vital role in addressing supply concerns, India's current recycling rates are insufficient. To bolster recycling efforts, the government should incentivize local smelting, refining, and fabrication industries, promoting innovation and aligning these efforts with sustainability goals.

To further support the domestic copper industry, India must assess the impact of its trade agreements on copper products. Initiatives like extending countervailing duties or reducing customs duties on copper ore and concentrate could enhance the viability of local production.

Lastly, operational challenges, including fluctuating tax policies and stringent environmental regulations, can limit production capacity. Addressing these issues will be crucial for enhancing efficiency within the copper sector.

To effectively tackle these challenges, India needs a well-defined copper strategy as part of its broader critical mineral policy. This strategy should prioritize securing diverse copper supplies, promoting domestic exploration, evaluating trade reforms, and incentivizing innovation and recycling. By taking these steps, India can better position itself to meet future copper demand and advance its renewable energy ambitions.