U.S. Treasury Secretary Scott Bessent has announced that India and Australia will join a key meeting of G7 finance ministers in Washington on Monday, focused on securing supplies of critical minerals.

This gathering underscores growing Western concerns over China's dominance in these vital resources, which power everything from defence technologies to renewable energy systems.

Bessent, who has championed a dedicated forum on the issue since last summer's G7 leaders' summit, revealed the invitation during a Reuters interview after visiting Winnebago Industries' engineering lab near Minneapolis. He noted that finance ministers had already convened virtually in December, building momentum for this in-person discussion.

India's invitation highlights its rising strategic importance, though Bessent expressed uncertainty over whether New Delhi has confirmed attendance. The outreach extends beyond the core G7 nations—United States, Britain, Japan, France, Germany, Italy, Canada, and the European Union—to counter vulnerabilities in global supply chains.

Australia's participation aligns with its recent pact with the U.S., signed in October, which includes an $8.5 billion project pipeline. Canberra aims to leverage its proposed strategic reserve of metals like rare earths and lithium, drawing interest from Europe, Japan, South Korea, and Singapore.

China controls between 47% and 87% of global refining for key minerals such as copper, lithium, cobalt, graphite, and rare earths, per International Energy Agency data. These materials underpin semiconductors, batteries, refining processes, and defence hardware, making supply disruptions a major geopolitical risk.

Western nations have intensified efforts to diversify away from Beijing's grip, especially after China's strict export controls on rare earths. Recent reports indicate China has curtailed exports of rare earths and powerful magnets to Japanese firms, alongside bans on dual-use items for Japan's military.

The timing of Monday's meeting is acute, coming just days after these Chinese restrictions surfaced. Bessent, however, stated that Beijing continues honouring commitments to buy U.S. soybeans and supply critical minerals to American companies, suggesting selective tensions rather than outright rupture.

For India, this invitation resonates amid its push for self-reliance in defence and aerospace, sectors heavily reliant on rare earths for indigenous projects like Tejas fighters and Gaganyaan missions. As a Bengaluru-based professional tracking such developments, you may note parallels with DRDO and HAL's material sourcing challenges.

Australia, a key Quad partner with India, brings proven reserves and processing ambitions. Its U.S. deal exemplifies bilateral moves to build resilient chains, potentially opening doors for Indian firms in joint ventures or technology transfers.

The G7's June action plan already pledged to secure supplies and invigorate member economies. Extending invites to India and Australia signals a broader "friends of G7" approach, echoing patterns in defence pacts like AUKUS.

Broader context from recent Economic Times coverage reveals U.S.-China trade flux: tariff truces, pauses, and Bessent's tariff warnings have roiled markets, with gold surging and the dollar weakening amid fiscal worries. Critical minerals fit into this tariff-laden landscape.

India's domestic angle sharpens with attachments noting Vedanta's Saudi gold-copper bets and NTPC's renewable expansions, both mineral-intensive. Russian oil sanctions also push India towards diversified energy imports, indirectly tying into mineral-secure EV and battery growth.

Geopolitically, this meeting could accelerate India-U.S. defence ties, building on iCET initiatives for semiconductors and quantum tech. Pakistan and China dynamics loom, as India's mineral diversification aids border defence hardware like hypersonic missiles.

Challenges persist: scaling non-Chinese refining demands massive investment, environmental scrutiny, and skilled labour—areas where India's Tata Advanced Systems or Adani Defence could pivot. Australia's model offers a blueprint.

Bessent's proactive stance, amid U.S. debt downgrades and Trump tax debates, positions minerals as a fiscal-diplomatic lever. Success here might stabilise prices for lithium in India's booming EV sector.

Ultimately, this Washington conclave marks a pivotal step in reshaping global mineral flows, with India poised as a swing player in the Indo-Pacific. Outcomes could influence 2026 defence procurements and space ambitions back home.

Based On Reuters Report