India’s first deep-sea critical minerals auction falters on tepid response

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India’s first auction of deep-sea blocks of critical minerals, which are vital for electric vehicles, defence equipment and renewable energy, has been delayed indefinitely following a poor response from bidders, government officials have told Moneycontrol.

The auction process was launched in November, with 13 deep-sea mineral blocks, including three lime mud blocks, three construction sand blocks, and seven polymetallic nodule blocks, up for grabs.

The initial bid deadline of February 27 was moved to April 2, then to May 1 and again to August 22.

“Yes, the auction did not take place on August 22 as was planned. It has been postponed until further notice. A new date is yet to be finalised,” one of the officials cited above said.

The blocks span the Arabian Sea on the west and the Andaman Sea on the eastern side and contain critical minerals such as cobalt, copper, manganese, and nickel.

India wants to get into undersea mineral exploration through the auction, which has faced stiff opposition from political parties in the coastal state of Kerala as well as its fishing community, worried about environmental risks.

The government wants wider participation and that is the reason it put off the auction, a second official said. “Some companies also have multiple queries since it is the first time that such an auction has been announced. We are clearing all their doubts and have allowed them time to check out the blocks on offer,” the official said.

The mines ministry did not respond to Moneycontrol’s emailed queries.

Technology remains the biggest challenge for India’s foray into the sector, experts say. “Basically, the entire supply chain, including technology, has become concentrated. Now the whole world is scrambling to create new technologies,” Arvind Virmani, Niti Aayog member, had said at the India Mining Summit in New Delhi on September 18.

China is the world’s largest producer of critical minerals, including rare earth elements that are essential for electronics, EV batteries, and defence equipment. Its dominance has turned into a global concern, especially after Beijing restricted exports of certain critical minerals.

To avoid being caught in the supply squeeze, India launched the National Critical Mineral Mission in January. The mission aims to expand exploration, boost domestic processing, and scale up recycling of critical minerals, reducing the country’s import dependency.