Why critical minerals have become the new oil in India-Japan ties

For decades, oil shaped global geopolitics. Nations went to great lengths to secure crude supplies because energy meant economic power, military strength and diplomatic leverage.

Today, the race isn't for oil anymore.

Instead of oil wells in West Asia, countries are scrambling for lithium, cobalt, nickel and rare earth elements. These are the minerals that power electric vehicles, smartphones, wind turbines, missiles and advanced semiconductors.

And nowhere would this shift be more evident than at the 16th India-Japan Annual Summit, where Prime Minister Narendra Modi and Japanese Prime Minister Sanae Takaichi are set to unveil a Joint Declaration on Economic Security.

While the summit will cover everything from AI to defence, the real headline will be the growing focus on critical minerals.

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Why these minerals matter

Critical minerals are the backbone of almost every technology defining the 21st century.

A single electric vehicle battery requires large quantities of lithium, nickel, cobalt and graphite. Rare earth elements are essential for EV motors, wind turbines, fighter jets, satellites and missile guidance systems. Semiconductors, the brains of modern electronics, also depend on a secure supply of these materials.

Without them, there is no clean energy transition, no AI revolution and no advanced manufacturing.

That is why countries are now treating critical minerals not just as an economic issue, but as a national security priority.

The China challenge

The urgency stems largely from China's dominance over the global supply chain.

China produces a significant share of the world's critical minerals, but its biggest advantage lies in processing and refining them. While many countries mine these minerals, they often end up being shipped to China for refining before entering global supply chains.

This concentration has become a strategic concern.

Recent Chinese export restrictions on certain rare earth elements and permanent magnets highlighted just how vulnerable global industries, from electric vehicles to defence manufacturing, can be when supply chains depend heavily on one country.

For both India and Japan, reducing that dependence has become a shared priority.

A partnership built on complementary strengths

Interestingly, India and Japan bring different strengths to the table.

India possesses sizeable reserves of several critical minerals and continues to identify new deposits. However, it lacks sufficient large-scale refining and processing infrastructure.

Japan, on the other hand, has world-leading expertise in metallurgy, battery technology and advanced material processing but has almost no significant domestic mineral reserves.

That makes the partnership a natural fit.

India can supply the raw resources. Japan can provide the technology, capital and manufacturing expertise needed to convert them into high-value products.

Instead of exporting raw ore, India wants to move up the value chain by refining and processing these minerals domestically, a transition that Japanese investment could help accelerate.

More than just mining

The India-Japan strategy extends far beyond extracting minerals.

The two countries are expected to deepen cooperation in three major areas:

Together, these measures aim to create resilient supply chains that are less vulnerable to external shocks.

Fuel for the clean energy economy

The stakes extend beyond geopolitics.

India's ambitious electric mobility, renewable energy and green hydrogen programmes will require enormous quantities of critical minerals over the coming decades.

Japan faces similar pressures as it seeks to maintain its leadership in electric vehicles, robotics, semiconductor manufacturing and advanced electronics.

For both countries, securing reliable mineral supplies is essential to meeting climate targets while remaining globally competitive.

A partnership for the next industrial era

India and Japan have spent the past two decades building their partnership through infrastructure projects, industrial corridors and the Mumbai-Ahmedabad bullet train.

The next chapter looks very different.

The focus is shifting from physical infrastructure to economic security, resilient supply chains and technological sovereignty.

With Japan targeting major new private-sector investments in India and both countries aligning on critical minerals, semiconductors and clean technologies, the relationship is evolving into something much broader than trade.

The geopolitics of the 20th century revolved around pipelines and oil tankers. But the geopolitics of the 21st century will increasingly revolve around battery materials, rare earths and semiconductor supply chains.