NEW DELHI: When Diet Coke disappeared from store shelves and quick commerce apps across Mumbai, Bengaluru and Ahmedabad this April, most people blamed the war in West Asia. The Iran-linked disruption to Gulf aluminium smelters was real and its impact on global supply chains was measurable. India the world’s second largest aluminium producer could not make enough cans to meet its own beverage demand.
This contradiction is not accidental. It is a pattern which runs through almost every major mineral Sector the country sits on.
The Paradox
India produces approximately 4.1 million tonnes of primary aluminium annually accounting for roughly 6% of global output. Yet leading beverage companies import around 20% of their metallic cans from overseas. The domestic can manufacturing market currently valued at around $400 million, is projected to double to $800 million by 2032 but the market demands are outpacing this growth trajectory. Two manufacturers, Ball Beverage Packaging India and Canpack India, currently dominate domestic supply. Both had already maxed out capacity before this summer’s shortage arrived.
Rare earths tells a sharper version of the same story. India holds approximately 6.9 million tonnes of rare earth oxide reserves the third largest in the world, representing 6 to 7% of global reserves. Despite this India contributes less than 1% of global rare earth production. The finished products that these minerals eventually become neodymium-iron-boron magnets used in electric vehicles, wind turbines and electronics are imported almost entirely from China. In FY 2023-24, India imported 460 tonnes of rare earth magnets, with the overwhelming majority sourced from a single country. India has the geology but does not have the refinery.
Iron ore follows the same logic at a larger scale. India is the fourth largest producer of iron ore globally with output of around 310 million metric tonnes in 2025. It is also the second largest producer of crude steel in the world. And yet in FY 2023-24, India was a net importer of finished steel and imported 8.32 million tonnes against exports of 7.49 million tonnes. The gap has widened since and between April and October of FY 2024-25 imports of finished steel stood at 5.77 million tonnes against exports of just 2.75 million tonnes.
Coal adds another layer. India mined over 1,047 million metric tonnes of coal in FY 2024-25, making it the second largest producer and consumer in the world after China. But domestic coal has high ash content and insufficient coking quality for steelmaking. As a result, India imported 59 million tonnes of coking coal in FY 2023-24, valued at approximately ₹1.33 lakh crore from the same global market that its own raw coal feeds at the other end.
Titanium, manganese and graphite complete the picture. India holds ilmenite deposits accounting for 11 to 21% of global titanium-iron reserves yet imports approximately $1 billion worth of titanium dioxide annually. India has the second largest manganese ore reserves in the world at an estimated 430 million tonnes yet imported $2 billion worth of lithium-ion batteries in 2023, with 75% sourced from China. India produces natural graphite and holds 8.6 million metric tonnes in reserves a key input for battery anodes yet remains dependent on Chinese battery cells and components.
One Problem Behind All of It
India has consistently invested in extraction but not in processing. The gap between pulling a mineral out of the ground and turning it into a finished industrial product that is refined rare earth, coking-grade metallurgical coal, battery-grade graphite or a beverage can has never been systematically closed. China built that processing infrastructure over three decades often at a loss and now controls the midstream of nearly every critical mineral supply chain in the world. India by contrast has remained largely at the raw material end, exporting ore and importing the value that was added elsewhere.
What the Government Is Now Doing
The policy response is beginning to take shape though it is still early. The National Critical Mineral Mission launched under the Ministry of Mines framework, is designed to secure India’s supply chain for rare earths, lithium, cobalt, graphite, and manganese focusing specifically on domestic processing and refining infrastructure and not just extraction. The 2025-26 Union Budget carried announcements around dedicated rare earth corridors aimed at integrating upstream mining with refining and magnet manufacturing in a single industrial cluster. The Production Linked Incentive scheme has been extended to battery cell manufacturing and graphite-based anode material plants with the explicit goal of building the processing layer that has been missing.
These are meaningful steps but the scale of the gap that had built over decades of policy neglect will stretch the results to reflect in a significantly long time span.
In FY 2023-24, 59% of India’s rare earth metal imports came from China. Nearly 75% of its lithium-ion battery imports came from China. The country that India imports its finished mineral products from is the same country it considers its most significant strategic competitor. Every tonne of rare earth magnet, every battery cell, every can of titanium dioxide purchased from Chinese suppliers is a transaction that deepens a dependency India has publicly committed to reducing.
What the Can of Diet Coke Actually Tells Us
Supplies are already beginning to stabilise in some cities. But the underlying condition that made it possible in a country that produces millions of tonnes of aluminium annually and cannot meet its own can demand will not resolve on its own. It will resolve only when India builds the industrial infrastructure to add value to what it already owns.
That work is now underway. The irony is not just economic. It is strategic. As long as India remains a raw material economy that outsources value addition to its competitors, every disruption, a war in West Asia, a Chinese export restriction or a regulatory delay will find the same gap to walk through.
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