Geography & BiodiversityPriority2026-02-21

India and Brazil Sign Critical Minerals MoU

Why focus: GS1/GS3 Critical Minerals — tests bilateral supply chain mapping and Rare Earth Elements via Match-the-Following format.

In News

What Happened

During Brazilian President Luiz Inácio Lula da Silva's state visit to India on February 21, 2026, the two nations signed a Memorandum of Understanding (MoU) on Rare Earth Elements (REEs) and Critical Minerals. The agreement establishes a cooperative framework covering the entire mineral value chain, from joint exploration and mining to processing and AI-driven geoscientific data analysis. Alongside the minerals pact, the leaders committed to increasing bilateral trade to $20 billion by 2030 and signed related MoUs on steel supply chains and pharmaceuticals.

Why It Matters

This agreement is a cornerstone for India's strategic autonomy, allowing it to bypass China's dominance in the processing of critical minerals. By securing a reliable supply of resources like lithium, niobium, and rare earths from Brazil, India can safeguard its clean energy transition, defense manufacturing, and semiconductor industries while strengthening the geopolitical influence of the Global South.

Background

History & Context

India's transition to green energy and advanced electronics is heavily dependent on critical minerals, a sector long dominated by China. To address vulnerabilities, India published a list of 30 critical minerals in July 2023 and amended the Mines and Minerals (Development and Regulation) Act in 2023 to auction domestic blocks. In January 2025, the Union Cabinet escalated these efforts by approving the National Critical Mineral Mission (2024-25 to 2030-31) for domestic exploration and end-of-life recovery. Internationally, state-backed Khanij Bidesh India Ltd. (KABIL) pursued acquisitions in Argentina and Chile. To complement these efforts and India's recent entry into the US-led 'Pax Silica' initiative in February 2026, India sought a direct pipeline with Brazil. Brazil holds 21 million tons of rare-earth-oxide equivalents—the world's second-largest reserve—but has explored only about 30% of it. This MoU materializes the strategic roadmap established during Prime Minister Modi's state visit to Brazil in July 2025.

What Changed

▶
Value Chain Integration: BEFORE, bilateral mining engagement was primarily transactional and focused on raw iron ore; NOW, the MoU explicitly covers the entire critical mineral value chain, including processing, refining, and recycling.
▶
AI in Exploration: BEFORE, geological surveying relied on traditional data sharing; NOW, the agreement officially mandates the use of Artificial Intelligence for precision geoscientific data analysis, aligning with the 2nd AI Impact Summit held in Delhi.
▶
Steel Supply Resiliency: BEFORE, India imported Brazilian iron ore without strategic technological tie-ups; NOW, a dedicated steel MoU leverages Brazil's niobium and iron ore to support India's goal of expanding steelmaking capacity to 218 million tonnes using sustainable technologies.
▶
Reciprocal Investments: BEFORE, Indian foreign direct investment in Brazilian mines lacked a formal protective and promotional umbrella; NOW, the pact establishes a bilateral framework to attract Indian capital into greenfield and brownfield infrastructure in Brazil.
▶
Bilateral Trade Targets: BEFORE, trade volume ambitions were loosely defined; NOW, a formal target has been set to scale bilateral trade from $15.2 billion to $20 billion by 2030.

What Did NOT Change

Despite the comprehensive scope of cooperation, the MoU remains a non-binding framework, meaning commercial execution still requires distinct contracts negotiated by entities like KABIL or Brazil's Vale S.A. Furthermore, Brazil maintained its non-aligned stance by not joining the US-led Pax Silica semiconductor initiative, ensuring this mineral pact remains strictly a bilateral Global South endeavor.

Prelims Angle

NCERT Connection

This development is a direct real-world extension of Class 12 Geography (India - People and Economy), Chapter 5: 'Mineral and Energy Resources'. The chapter highlights the uneven spatial distribution of minerals in India and the scarcity of non-ferrous and critical minerals. The India-Brazil MoU acts as a geopolitical solution to the geographic limitations described in the NCERT, bridging domestic geological deficits with foreign diplomacy to ensure energy and industrial security.

Common Misconceptions

✗ Rare Earth Elements (REEs) are called 'rare' because they are scarce in the Earth's crust.

✓ They are relatively abundant globally but are rarely found in concentrated, economically viable ores. They often occur mixed with radioactive elements like thorium or uranium, making extraction and refining difficult and highly toxic.

The terminology 'rare' was adopted in the 18th and 19th centuries when these elements were first discovered in isolated, obscure minerals before modern geological surveying revealed their widespread presence.

✗ China completely monopolizes the natural reserves of Rare Earth Elements globally.

✓ While China has the largest reserves, countries like Brazil possess massive deposits (approx. 21 million tons, the world's second-largest). China's monopoly lies in the processing, refining, and metallurgical capacities it built over decades.

Mainstream media frequently conflates China's 60-70% dominance in 'production and processing' with its share of natural 'geological reserves'.

Practice Questions

Q1

How Many Correct

Consider the following statements regarding the critical minerals cooperation between India and Brazil: 1. Brazil possesses the world's largest known reserves of Rare Earth Elements (REEs). 2. The 2026 MoU specifically incorporates the use of Artificial Intelligence for geoscientific data analysis to aid mineral exploration. 3. The National Critical Mineral Mission, approved by the Indian Cabinet in January 2025, aims to build domestic capacity across the mineral value chain. How many of the above statements are correct?

Q2

Match the Following

Match List I (Initiative/Entity) with List II (Context) in the backdrop of India's mineral security: List I A. Pax Silica B. KABIL C. ANVISA D. National Critical Mineral Mission List II 1. State-backed Indian joint venture for overseas mineral acquisition 2. US-led initiative joined by India for securing the semiconductor supply chain 3. Brazilian regulatory agency involved in the 2026 bilateral MoUs 4. Domestic initiative launched to accelerate end-of-life recovery and processing Select the correct answer using the code given below:

Q3

Assertion & Reason

Assertion (A): The signing of the India-Brazil Critical Minerals MoU strengthens India's bargaining power in the global mineral market, reducing its vulnerability to unilateral export restrictions. Reason (R): Brazil recently became a signatory to the US-led Pax Silica initiative, establishing a legally binding mineral supply corridor to member states like India. Select the correct answer:

Up next