An FTA No One Is Talking About Can Give India a Strategic Edge

Why It Matters

The deal gives India a reliable source of battery‑grade minerals, reducing dependence on volatile global markets and strengthening its industrial competitiveness. Securing these inputs underpins the country’s renewable‑energy transition and export‑driven manufacturing growth.

Key Takeaways

• Chile holds vast lithium, copper, cobalt reserves.
• India‑Chile CEPA targets critical minerals, digital services.
• Coal India to create 100% Chile holding company.
• Imports from Chile rose 72% in FY 2024‑25.
• Agreement could boost Make in India manufacturing resilience.

Pulse Analysis

Global competition for critical minerals has intensified as nations treat lithium, copper and cobalt as strategic assets rather than mere commodities. Chile, the world’s leading lithium exporter and a major source of copper and rhenium, sits at the centre of this race. For India, whose manufacturing push under Make in India and its ambitious clean‑energy targets require secure, affordable inputs, a stable supply line from Chile could offset the volatility of existing markets and lower input costs for batteries, solar panels and high‑tech devices.

The proposed Comprehensive Economic Partnership Agreement goes beyond traditional tariff cuts, embedding cooperation on digital services, investment promotion and, crucially, critical mineral trade. Recent corporate actions underscore the partnership’s momentum: Coal India’s board approved a 100% owned Chilean holding company to explore lithium and copper, while the Adani Group signed a joint‑exploration framework with Codelco. Trade figures reinforce the narrative—Indian imports from Chile jumped 72% to $2.6 billion in FY 2024‑25, even as exports slipped, revealing a clear raw‑material dependency that the CEPA aims to transform into a value‑added supply chain.

If concluded, the India‑Chile pact could become a cornerstone of India’s resource‑security strategy, offering a diversified alternative to Chinese‑dominated supply chains. By locking in long‑term access to essential minerals, India can accelerate its renewable‑energy rollout, boost domestic battery production, and enhance the competitiveness of its export‑oriented manufacturing sector. The agreement also signals to other trading partners that India is pursuing a proactive, strategic approach to trade, positioning itself as a resilient player in the evolving geopolitics of critical mineral supply.