Researchers argue India can build a domestic critical-minerals market through import-led trading on exchanges like MCX, similar to how it trades imported crude oil and gold, without first developing lithium mines of its own.
At a glance
- India's projected lithium demand jumps from 66,000 tonnes (2025-2030) to 1.62 million tonnes (2031-2050) under NITI Aayog's Net Zero Scenario, with comparable multi-fold increases projected for nickel, graphite and copper.
- Researchers Vaibhav Pratap Singh and Rati Verma argue India can build a deep critical-minerals market the same way it already trades imported crude oil and domestically scarce gold -- through exchange infrastructure, not mine ownership.
- The Multi Commodity Exchange (MCX) recorded 70 lakh crore rupees in futures turnover and 495 lakh crore rupees in options turnover in FY2024-25, infrastructure the authors say could extend to lithium, nickel, cobalt, graphite, copper and rare earths.
- Lithium prices rose almost eightfold during 2021-22 before falling more than 80% from their 2023 levels, dropping from above $80,000 a tonne to around $13,000 a tonne by early 2024 -- volatility the authors say a domestic reference price could help manufacturers hedge against.
What happened
India's lithium demand is projected to climb from 66,000 tonnes between 2025 and 2030 to 1.62 million tonnes between 2031 and 2050, under NITI Aayog's Net Zero Scenario -- alongside similarly steep jumps for nickel (254,000 tonnes to 3.76 million tonnes), graphite (700,000 tonnes to 15 million tonnes) and copper (1.88 million tonnes to 20.6 million tonnes) over the same two periods. India mines essentially none of these domestically at commercial scale today, yet Vaibhav Pratap Singh and Rati Verma of the Climate and Sustainability Initiative argue in a September 14, 2026 piece that the country doesn't need to own the ore to build a real market around it. Their case rests on two precedents already running in India: the country imports most of the crude oil it refines and produces little of its own gold, yet both commodities trade deeply and actively through the Multi Commodity Exchange (MCX), which recorded 70 lakh crore rupees in futures turnover and 495 lakh crore rupees in options turnover in the 2024-25 financial year. Amendments to the Mines and Minerals (Development and Regulation) Act in 2025 have now cleared a legal path for India to build similar markets or exchanges specifically for critical minerals.
The details
Singh and Verma start from a reframe. India's critical-minerals problem gets described almost entirely as a mining shortfall, but the authors argue that misses where the real economic value sits. "India's critical-minerals challenge is often framed as a mining problem," they write. "But even without controlling the mines, India can control more of what happens after the minerals leave them." That's a deliberate shift away from the exploration blocks and auction tranches that dominate India's current critical-minerals policy, toward the processing, pricing and trading infrastructure that determines who actually captures value once ore is out of the ground.
The scale of the demand side is what makes the reframe feel urgent rather than academic. NITI Aayog's own Net Zero Scenario projects India's lithium requirement rising from 66,000 tonnes between 2025 and 2030 to 1.62 million tonnes between 2031 and 2050 -- a roughly 24-fold jump -- with nickel climbing from 254,000 to 3.76 million tonnes, graphite from 700,000 tonnes to 15 million tonnes, and copper from 1.88 million to 20.6 million tonnes across the same two windows. Even in an optimistic scenario where India's own mines and overseas offtake deals scale up quickly, those volumes mean the country will keep importing a large share of what it consumes for years, if not decades.
That import exposure is exactly where price volatility stops being a market curiosity and becomes a real operating risk. BloombergNEF estimates average lithium-ion battery prices fell 20% in 2024 to $115 a kilowatt-hour, after a 14% decline in 2023, with prices projected to reach around $50 a kilowatt-hour by 2025-26 -- a trajectory that looks smooth only if you skip past what happened to the underlying metal. Lithium prices rose almost eightfold during 2021-22, then fell more than 80% from their 2023 levels, dropping from above $80,000 a tonne to around $13,000 a tonne by early 2024. Swings of that size ripple through mine economics, battery costs, procurement contracts and investment decisions for every Indian company buying lithium, regardless of whether that lithium was ever mined on Indian soil.
The authors' answer isn't to build a global price-setting mechanism -- India doesn't produce enough of these minerals to move world prices the way it might for a staple commodity. It's to build a domestic reference price, the same way India already has for two other commodities it imports heavily and produces little of. India imports most of the crude oil it refines yet trades it actively; it produces little gold relative to what it consumes, yet gold remains one of the most actively traded commodities on Indian exchanges. Both examples run through the same institution the authors want to extend to critical minerals: the Multi Commodity Exchange, which posted 70 lakh crore rupees in futures turnover and 495 lakh crore rupees in options turnover in FY2024-25, and already has clearing, warehousing, assaying and physical-delivery infrastructure built out. Reusing that infrastructure, rather than standing up something new, is the practical core of the proposal.
The design Singh and Verma sketch is deliberately staged. It starts with import-led physical trading in standardised lithium carbonate and lithium hydroxide, priced off international benchmarks adjusted for freight, taxes, the rupee-dollar exchange rate, financing costs, quality and domestic demand -- a formula that would, for the first time, make visible to Indian buyers the markups currently added by intermediaries several steps removed from the mine. Only once trading volumes build up would the market add forwards, futures and options, giving battery manufacturers and processors an actual hedging tool against the kind of eightfold-and-back-down swings lithium has already shown this decade. The scope, they argue, shouldn't stop at lithium -- nickel, cobalt, graphite, copper and rare earths all face similar import dependence and similar price volatility, and the same market architecture could extend to each.
What the piece doesn't do is quantify where India's processing capacity actually stands today against those NITI Aayog demand curves. It cites specific company moves -- Exide Industries' lithium-ion cell plant in Bengaluru, Waaree Energies' battery gigafactory in Andhra Pradesh, Tata's in-house battery-cell development -- without stating what tonnage of refined lithium or battery-grade material India can actually produce right now. A trading market can make prices transparent and let manufacturers hedge risk, but it doesn't by itself create a single tonne of processed lithium. That gap is the part of India's critical-minerals story this particular proposal leaves for a separate policy push to close.
Why it matters
For Indian battery makers, processors and eventually retail investors, a transparent domestic reference price would turn an opaque, import-dependent cost line into something that can be tracked and hedged -- the same shift Indian oil refiners and gold traders made decades ago without India ever needing to become a major crude or gold producer.
Our read
Outlook: neutral. This is a market-structure proposal from independent researchers, not a policy already in force or a supply/demand event. It doesn't change India's actual lithium import volumes, mining output or global prices on its own, even though the underlying demand and volatility data it cites are real and relevant to how Indian buyers experience price risk.
What to watch
- Whether India's 2025 Mines and Minerals (Development and Regulation) Act amendments translate into an actual regulatory framework or exchange licence for critical-minerals trading
- Trading volumes on any pilot lithium carbonate or lithium hydroxide contract MCX or another Indian exchange might launch
- Whether India discloses baseline data on its current lithium, nickel and graphite processing capacity, which would make the size of the production gap measurable for the first time
For information only, not investment advice.
Lithium price in India
metalscost.com India reference price as of 2026-10-03.
Detailed analysis
Timeline
- 2021: Lithium prices began an almost eightfold climb through 2021-22 amid a global battery-demand surge.
- 2024-01: Lithium prices fell from above $80,000 a tonne to around $13,000 a tonne, capping a decline of more than 80% from 2023 levels.
- 2025: Amendments to India's Mines and Minerals (Development and Regulation) Act cleared the legal path for critical-minerals markets or exchanges.
- 2026-02: Waaree Energies announced a battery gigafactory investment of Rs 8,175 crore in Andhra Pradesh.
- 2026-08-04: Tata's battery unit, Agratas Energy Storage Solutions, was reported shifting to in-house LFP cell technology at its Sanand, Gujarat plant.
- 2026-09-14: Climate and Sustainability Initiative researchers Vaibhav Pratap Singh and Rati Verma published their proposal for an import-led Indian critical-minerals market in Outlook Business.
Demand Drivers
NITI Aayog's Net Zero Scenario projects India's lithium demand rising roughly 24-fold, from 66,000 tonnes (2025-2030) to 1.62 million tonnes (2031-2050), with comparable multi-fold growth for nickel, graphite and copper over the same two periods.
Government Policies
Amendments to India's Mines and Minerals (Development and Regulation) Act in 2025 cleared the legal path for developing minerals markets or exchanges, the regulatory opening the authors' proposed critical-minerals trading platform depends on.
Currency Impact
The proposed domestic reference price would explicitly incorporate the rupee-dollar exchange rate as one of its core adjustment factors, alongside freight, taxes, financing and quality, when translating international lithium benchmarks into an Indian price.
Mining Production
The article cites steep demand projections but provides no baseline figure for India's current domestic lithium, nickel or graphite mining output, leaving the actual size of the production gap unstated.
Refinery Output
Beyond references to Exide Industries' lithium-ion cell plant in Bengaluru, Waaree Energies' Andhra Pradesh battery gigafactory and Tata's in-house battery-cell development at Agratas, the article gives no tonnage or capacity figures for India's current or planned lithium refining and battery-material processing.
What could lift prices
- India's lithium, nickel, graphite and copper demand is projected to grow many-fold by 2050 under NITI Aayog's own Net Zero Scenario, giving a domestic exchange enough eventual trading volume to become genuinely liquid.
- MCX already runs 70 lakh crore rupees in annual futures turnover with established clearing, warehousing and assaying infrastructure that critical-minerals trading could plug into rather than build from scratch.
- The 2025 amendments to the Mines and Minerals (Development and Regulation) Act removed the specific legal obstacle that previously stood in the way of building such a market.
What could weigh on prices
- The proposal offers no current baseline for India's domestic lithium or critical-mineral processing capacity, leaving the actual size of the country's refining gap -- separate from any trading infrastructure -- unaddressed.
- Lithium and related battery-material prices have shown extreme volatility, an almost eightfold rise in 2021-22 followed by an 80%-plus fall, which could make early price discovery on a new, thin market difficult until trading volumes build up.
- An import-led exchange still depends entirely on the same overseas mines and Chinese-dominated refining capacity India already relies on -- it prices that dependence more transparently but doesn't reduce it.
Country impact
| Country | Impact | Reason |
|---|---|---|
| India | High | The proposal is specifically about building India's own domestic critical-minerals trading infrastructure, using the same import-led model the country already runs for crude oil and gold. |
Industry impact
| Industry | Effect | Reason |
|---|---|---|
| Battery Manufacturing | Positive | A transparent domestic lithium reference price, with eventual forwards and futures, would give Indian battery makers a hedging tool against the kind of price swings lithium has already shown this decade. |
| Electric Vehicle Manufacturing | Positive | More predictable and transparent lithium, nickel and copper pricing would help EV manufacturers plan procurement and costs even while India remains reliant on imported battery-grade material. |
Who gains, who loses
- Indian battery and EV manufacturers: A domestic reference price and eventual futures market would give manufacturers a hedging tool against the kind of import-price volatility lithium has already shown this decade.
- MCX and India's commodity-trading ecosystem: Extending an already-scaled exchange -- 70 lakh crore rupees in FY2024-25 futures turnover -- into a new critical-minerals asset class would add trading volume to existing infrastructure.
- Intermediary traders capturing opaque markups between the mine and Indian buyers: A transparent reference price incorporating freight, taxes, exchange rates and financing would expose and likely compress margins currently hidden several steps away from the mine.
Other ways this could play out
- If MCX successfully extends its existing crude oil and gold trading model to lithium and other critical minerals, Indian battery manufacturers and processors could gain a genuine domestic hedging tool years before the country develops meaningful mining or refining capacity of its own.
- If trading volumes stay too thin to support real price discovery, the proposed market could remain a benchmark-adjustment exercise rather than the liquid, forwards-and-futures market the authors describe as the end goal.
Price risks
- Lithium prices have already shown they can move nearly eightfold in one direction and then fall more than 80% within about two years, a volatility level any new Indian reference price would need to absorb rather than smooth away.
- A domestic market that stays thin in its early phase could produce a reference price that diverges meaningfully from international benchmarks, undermining the transparency the proposal is meant to deliver.
Historical comparison
- India's crude oil and gold markets: India imports the overwhelming majority of the crude oil it refines and produces little of the gold it consumes, yet both commodities trade deeply on Indian exchanges -- the precedent the authors cite for why lithium wouldn't need domestic mining either.
Technical view
Price is trading below both its 20-period and 50-period moving averages, a bearish alignment.
Computed from metalscost.com's own stored price history.
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