India’s Ambitious Copper Strategy: Securing the Future of a Critical Metal

Rising Demand and Supply Challenges

India’s copper consumption is growing at a rapid pace, positioning the country as the world’s second-largest importer of refined copper. In the fiscal year 2025, imports of copper reached approximately 1.2 million metric tons, reflecting a steady increase year over year. Projections suggest that by 2030, domestic demand for copper could triple to between 3 and 3.3 million metric tons, and by 2047, it may soar close to 9 million metric tons. This explosive growth in demand stems from India’s expanding infrastructure, manufacturing, and clean energy sectors, all of which heavily rely on copper.

India imported 1.2 million metric tons of copper in the fiscal year to March 2025, up 4 per cent from a year earlier | Photo Credit: UNKNOWN | Business Line

Despite possessing an estimated 12.2 million metric tons of copper in known deposits, only about 18 percent of these deposits are economically viable reserves. India’s limited domestic copper production capacity, combined with declining ore grades and increasing geopolitical complexities, has made the country highly dependent on imports. Without strategic intervention, experts warn that India could end up importing as much as 91 to 97 percent of its copper concentrates by the middle of this century.

The Reciprocal Investment Model: Fostering Global Partnerships

To counter the risks associated with over-reliance on imports, the Indian government has unveiled an innovative “reciprocal investment” policy framework. This approach seeks to create a two-way investment highway, where foreign copper mining companies establish smelters and refining facilities within India. In return, Indian public sector firms will invest in copper mining projects abroad, particularly in resource-rich countries such as Chile and Australia.

The government’s vision specifically targets major global players like Chile’s state-owned mining giant Codelco and Australian mining powerhouse BHP. By encouraging such collaborations, India aims not only to enhance its domestic processing capabilities but also to gain secure access to copper ore supplies from foreign mines. This model addresses the twin challenges of resource nationalism abroad and insufficient global investment in mining infrastructure.

Incentivizing Domestic Expansion and Recycling

India is complementing its reciprocal investment strategy with a strong incentive program to develop domestic copper processing capacity. The government plans to back the establishment of new smelting and refining units capable of processing between four to five million metric tons annually. Incentives include capital subsidies to ease infrastructure investments, exemptions on customs duties for importing essential machinery, and financial support for expanding scrap metal processing facilities. These efforts aim to boost domestic production, reduce import dependence, and foster a circular economy by encouraging recycling of copper scrap.

Alongside these economic incentives, the government has introduced regulatory reforms, such as the Quality Control Order on copper cathodes, to enhance product standards and industry competitiveness. Though these reforms have faced resistance from trade associations concerned about supply disruptions, the government is determined to push ahead to ensure quality assurance and long-term industry sustainability.

Leveraging Trade Agreements and Exploration Initiatives

Trade diplomacy is playing a central role in India’s copper strategy. The government is negotiating dedicated copper-focused provisions in free trade agreements with key copper-exporting nations like Chile and Peru. These agreements aim to secure fixed quotas for copper concentrates, thereby safeguarding supply chains from unpredictable market fluctuations and geopolitical tensions involving other countries.

Beyond trade talks, India has taken proactive steps to explore and develop mineral resources abroad. A notable initiative includes deploying geological teams to Zambia to conduct a three-year exploration project covering 9,000 square kilometers for copper and cobalt deposits. The success of this exploration may lead to leasing mining rights or establishing partnerships with private sector entities. Simultaneously, Indian state-owned companies such as Khanij Bidesh India Limited are actively scouting for copper and related mineral assets in Australia, Mongolia, Chile, Peru, and the Democratic Republic of Congo, broadening the country’s mineral sourcing portfolio.

Private Sector Momentum: Expanding Smelting Capacity

India’s private sector is demonstrating growing enthusiasm for investing in domestic copper processing infrastructure. For example, Adani’s Kutch Copper Limited in Gujarat has announced plans for a state-of-the-art smelter with an initial capacity of 500,000 tons per annum, which is expected to scale up to one million tons by 2028 or 2029. This facility will primarily source copper concentrates from Peru, Chile, and Australia, reflecting the international partnerships India seeks to foster.

Similarly, the JSW Group is preparing to build a 500,000 tons per annum copper smelter in Odisha, with ambitions to double capacity by the early 2030s. These projects are expected to significantly strengthen India’s domestic copper processing ecosystem and reduce vulnerability to global supply disruptions.

Parallels in Aluminum Strategy

India’s comprehensive approach to copper is mirrored in its aluminum sector, where demand is projected to reach 8.5 million metric tons by 2030. The government is rolling out similar incentives and capacity-building measures to develop domestic smelting, refining, and recycling infrastructure for aluminum, reinforcing its broader vision for critical mineral self-reliance and industrial growth.

Conclusion: A Forward-Looking Vision for Mineral Security

India’s multifaceted copper strategy reflects a bold and pragmatic response to the challenges of securing critical minerals amid rising demand and a complex global supply landscape. By fostering reciprocal global partnerships, incentivizing domestic capacity expansion, embedding copper in trade negotiations, and proactively exploring international mineral resources, India aims to transform itself from a passive importer into a resilient player with a robust industrial base.

The success of this strategy will depend on effective coordination across government agencies, the private sector, and international partners. If executed well, it could significantly enhance India’s economic security, support its energy transition goals, and strengthen its position in the global mineral economy over the coming decades.

(Sources: Business Line, Business Standard, Reuters)