India is set to finalise a preliminary agreement with Mongolia in the field of geology and exploration.
This mining pact aims to secure copper and coking coal supplies that are crucial to meet growing demand in India’s power, construction and steelmaking sectors, according to a report by Reuters, citing sources.
Landlocked Mongolia is rich in copper and coking coal deposits, while India is largely dependent on imports for these resources.
An official said: “India’s cabinet has approved the MOU [memorandum of understanding], and both countries are expected to sign it soon.”
Requests for comment from India’s Federal Mines Ministry did not elicit a response.
Mongolia’s Ministry of Mining and Heavy Industry is yet to comment on the development, the report said.
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Your download email will arrive shortly
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalData
According to industry officials, Mongolia can offer superior grades of coking coal, making it an attractive option for Indian companies.
In November, JSW Steel and the Steel Authority of India were in talks with Mongolia over coking coal imports.
Companies including Adani, Hindalco and Vedanta have shown interest in sourcing copper from Mongolia and both nations are currently discussing supply routes, with India favouring the Vladivostok route in Russia, the source said.
“China is convenient, but we prefer the route from Russia,” the official noted.
Relations between India and China have been tense since a 2020 border clash, although recent agreements have eased tensions.
India traditionally maintains close ties with Russia.
In a separate development, India’s Ministry of Coal recently launched the 11th round of its commercial coal mine auctions, offering 27 coal blocks.
This included ten fully explored and ten partially explored blocks.
This initiative aims to boost regional economic growth and employment, unlocking India’s coal reserves and enhancing energy security.
India also signed an MOU with the US in October last year to enhance supply chains for lithium, cobalt and other critical minerals used in electric vehicles and clean energy technologies.
