Indian Prime Minister Modi hailed the agreement on critical minerals and rare earths as a ‘major step towards building resilient supply chains’.
Brazil and India have signed an agreement to boost cooperation on critical minerals and rare earths, as the Indian government seeks new suppliers to curb its dependence on China.
Brazilian President Luiz Inacio Lula da Silva met Indian Prime Minister Narendra Modi in New Delhi on Saturday and discussed boosting trade and investment opportunities.
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Modi said in a statement that the agreement on critical minerals and rare earths was a “major step towards building resilient supply chains”.
China dominates the mining and processing of the world’s rare-earth and critical minerals, and has increased its grip on exports in recent months as the United States attempts to break its hold on the growing industry.
Still, for Brazil, which follows China as the world’s second-largest holder of critical minerals, its resources are used across a range of fields, including electric vehicles, solar panels, smartphones, jet engines, and guided missiles.
In a statement, Lula said, “increasing investments and cooperation in matters of renewable energies and critical minerals is at the core of the pioneering agreement that we have signed today.”
While few details have emerged about the mineral deal so far, demand for iron ore, a material for which Brazil is the second-largest producer and exporter after Australia, in India has grown amid rapid infrastructure expansion and industrial growth.
Rishabh Jain, an expert with the New Delhi-based Council on Energy, Environment and Water think tank, told the AFP news agency that India’s growing cooperation with Brazil on critical minerals follows recent supply chain engagements with the US, France and the European Union.
“Global South alliances are critical for securing diversified, on-ground resource access and shaping emerging rules of global trade”, Jain told AFP.
Trade agreements
India’s Foreign Ministry spokesperson announced that, along with the critical minerals and rare earths deal, nine other agreements were signed, including a memorandum of understanding that ranged from digital cooperation to health.
Moreover, Modi called Brazil India’s “largest trading partner in Latin America”.
“We are committed to taking our bilateral trade beyond $20bn in the coming five years,” he said.
“Our trade is not just a figure, but a reflection of trust,” Modi said, adding that “When India and Brazil work together, the voice of [the] Global South becomes stronger and more confident.”
India’s Foreign Minister Subrahmanyam Jaishankar also said he was confident that Lula’s talks with Modi “will impart a new momentum to our ties”.
According to the Observatory of Economic Complexity (OEC) in 2024, Indian exports to Brazil reached $7.23bn, with refined petroleum being the main export. On the other hand, Brazilian exports to India reached $5.38bn, with raw sugar being the main export.