As India continues its strategic courtship with several other like-minded developing countries for critical mineral partnership, the emerging architecture is becoming a defining pillar of its geopolitical and industrial strategy.
India’s near-total import dependence on energy transition minerals casts a shadow on supply chain resilience when seen from the dovetailed lenses of geopolitics and its weaponsiation by some countries through export restrictions and more. The dominant policy conversations now revolve around diversification which has become both a mantra and a metric of energy security.
Frequently, delegation-level talks especially between India and mineral rich regions like African and Latin American countries and India have been making news for acquisition of ores for digging. These are now widely interpreted as tangible evidence of India’s intent to strategically diversify its critical mineral supply base and reduce overdependence on single-source geographies like China for Graphite and Neodymium-Iron-Boron (NdFeB) magnets, both crucial ingredients for electric vehicles, wind turbines, etc., among others.
Behind the Numbers: The rise of re-export hubs
An assessment of India’s critical minerals’ import data recently undertaken by the author shows a mirage-esque situation. The data showed that a portion of India’s so-called diversification is actually routed not through resource-owning states but through re-export hubs like Belgium and Hong Kong (HK) which process or merely redistribute minerals originating elsewhere. The result is a deceptive map of supply chains that projects resilience while masking the very dependencies India seeks to escape.
Belgium is a striking example. India's trade statistics show growing cobalt imports from Brussels. Imports rose from ₹15.5 crore (~ USD 1.9 million) for ~85,400 kg in 2021 to a peak of ₹51.8 crore (~USD 6.2 million) in 2022 (172,000 kg), before tapering to ₹21.4 crore (~ USD 2.6 million) in 2024. It is important to note that Belgium has no domestic reserves whatsoever and it is the second largest refiner of cobalt in Europe.
What India is importing, therefore, is not cobalt originating in Belgium, but Belgium itself sourcing directly from the Democratic Republic of Congo (DRC) whose majority of mines are Chinese-owned and controlled. The DRC’s cobalt sector is well-documented for systemic governance risks, including labour exploitation, artisanal and informal mining dependency, opaque concessions, and severe environmental impacts.
Layers of costs and risks
The premium prices India pays, often several times the raw-material cost, reflects midstream value capture abroad. This three-way relationship also exposes India to the shifting geopolitical calculus between DRC and Belgium, effectively placing its supply chain at the mercy of external political, regulatory, and industrial shifts beyond its control. In turn, it also adds another layer of vulnerability due to Europe’s tightening ESG norms.
Hong Kong is China’s workaround
Hong Kong is another illustration of a geo-economic buffer that China has adopted as a strategy and it presents as a diversification node for India. Cerium oxides are used in catalytic converters, fuel cells and hydrogen-related applications. China’s cerium exports to India dropped in 2023 (from ~110,000 kg in 2022 to ~178,000 kg in 2023) which reflects that they used HK as a re-shipment hub. Additionally, the dip in volume from China exactly mirrors the increase in Hong Kong imports for that time period.
The import value for HK is reported at nil despite huge shipments. This is because trade data only captures the port of export and not the payment partner, further corroborating the findings. There are other countries with a similar trajectory, however, deeper research is needed to ascertain the same.
Diversification as strategy and illusion
Across these nodes, the pattern repeats: intermediary trading partners mask the true origin of minerals, and inflates India’s sense of security and supply chain resilience. Such practices create double dependency structures where India is indirectly tethered not only to China’s dominance but also to the political and trade dynamics of the intermediary state.
If geopolitical dynamics shift, for instance, if relations between DRC and Belgium sour, or if India’s own tensions with China deepen, the stability of these mineral flows could be jeopardised from multiple directions. In such a scenario, India’s access to cobalt and similar processed materials would face heightened risk.
Layered onto this are growing trends of tariffs, sanctions, export controls, and resource nationalism, all of which are now commonplace in the global critical mineral theatre. Together, these forces create a complex web of exposure that weakens India’s bargaining position and limits its strategic flexibility. At the outset, this is not diversification, rather a trend of outsourcing vulnerability into a more complex, and therefore harder to detect form.
Journey is equally important as the destination
This phenomenon is not a statistical quirk, it is a structural market behaviour shaped by logistics and strategic information asymmetries. For India, the implications are profound.
First, policy suffers if diversification indices treat Belgium or Hong Kong as independent supply sources, then India’s import portfolio appears healthier than it truly is, obscuring the underlying problems. Second, these hubs distort pricing and bargaining power. This locks India into a passive buyer role while other nations build strategic reserves, invest in beneficiation, and shape global standards for traceability and sustainability.
The deeper threat is, then, normative: re-export hubs make India believe it has hedged against geopolitical risk when in reality it has only multiplied the number of actors who can constrain its access. In doing so, the risk is diluted, not reduced. And diluted risk in the critical minerals landscape behaves like invisible debt, it accumulates quietly until the moment of crisis.
Origin is the key
What is required is a shift from import diversification to origin authentication. India must insist on end-to-end provenance through mechanisms such as Battery Aadhaar, bilateral customs-data exchange, and harmonised origin-reporting standards. Only then can policymakers distinguish genuine suppliers from intermediaries.
India also needs to develop its own refining and midstream capacity through robust measures under National Critical Mineral Mission (NCMM) and recover from recycling. Without domestic midstream infrastructure, India will always be vulnerable to the pricing power and strategic preferences of re-export hubs.
The clean-energy transition requires minerals, but minerals require governance, transparency, and strategic foresight. Unless India recognises the mirage of re-export diversification and confronts it head-on, the country risks building its energy future on unstable foundations. In the geopolitics of critical minerals, the map is never the territory. And unless India reads the map correctly, the path to energy security will remain more fragile than it appears.
(Meheli Roy Choudhury is a Research Consultant at Chintan Research Foundation.)
Views are personal and do not represent the stand of this publication.
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