By: Holly Stevens and Siddharth Sharma
Critical minerals have moved to the center of international economic and political discourse over the last year, emerging as a core instrument of diplomacy, industrial strategy, and economic statecraft. As demand for electric vehicles, battery storage, clean energy systems, and advanced technologies continues to accelerate, refining and processing capacity for the necessary critical minerals inputs for these technologies remains highly concentrated. This midstream bottleneck has emerged as one of the central challenges to supply chain diversification and resilience. The stakes are high. According to the International Energy Agency’s (IEA) Global Critical Minerals Outlook 2025, China controls the majority of refining and processing capacity for the most strategically important critical minerals, with market shares averaging around 70% across key materials, and controlling over 80% of the world’s processing for rare earths. China also produces 90% of the world’s rare earth permanent magnets. Under announced policy scenarios, the IEA projects that China will continue to dominate the processing of lithium, cobalt, rare earth elements, and battery-grade graphite well into the next decade. This concentration leaves global supply chains vulnerable to disruption as the rest of the world is only beginning to make concrete efforts to build resilience through diversification.
The Australia–Canada–India Technology and Innovation Partnership (ACITI) announced on November 22, 2025, is one of a number of recent international partnerships and consortiums that offers a potential response. According to the joint statement released at the G20 Summit in Johannesburg, ACITI aims to deepen cooperation related to emerging technologies, green energy innovation, resilient supply chains including critical minerals, and strategic sectors such as artificial intelligence for which critical minerals are foundational inputs.
ACITI joins a growing cohort of international diplomatic initiatives focused on building critical minerals supply chains with like-minded allies and partners, reflecting a broader search for workable diversification models. In July 2025, Australia and India, alongside the United States and Japan, announced the Quad Critical Minerals Initiative, focused on strengthening economic security and collective resilience through collaboration to secure and diversify mineral supply chains. The future of the Minerals Security Partnership (MSP), an initiative intended to coordinate across countries on concrete critical minerals projects, remains uncertain, accentuating the difficulty of sustaining momentum and translating broad participation into durable project level outcomes. More recently, the G7 has elevated critical minerals supply chains as a major priority, combining policy alignment through its Action Plan and Roadmap with commitments linked to real projects. Related to these G7 efforts, on January 12th, U.S. Treasury Secretary Scott Bessent hosted a G7 Ministerial focused on critical minerals cooperation, which included additional countries: Australia, Mexico, South Korea, and India. This meeting was significant in large part because it sent a signal of U.S. leadership. Prior to the ministerial meeting, India was also asked by the United States to join its new Pax Silica initiative, which focuses on critical minerals. The fact remains, however, that many of these commitments lack formal enforcement mechanisms or large-scale tools for building wider standard-based markets.
Against this backdrop, ACITI enters this landscape as a focused trilateral effort, raising the possibility that a smaller, cross-regional grouping may be better positioned to move from intent to action. ACITI’s significance lies in its attempt to align capabilities across different stages of the value chain. Australia is a leading producer of lithium, rare earth elements, and other important minerals such as cobalt, tantalum, and uranium, and has increasingly emphasized the need to move beyond extraction toward value-added processing aligned with its energy transition goals. Canada brings deep mining expertise, a mature regulatory and investment environment, and an industrial strategy designed to attract large-scale investment into clean energy and critical minerals development. It is also a key global producer of minerals including aluminum, cobalt, fluorspar, indium, niobium, palladium, platinum, tellurium, titanium concentrate, and uranium. Together, Australia and Canada contribute decades of technical experience, established regulatory systems, and globally active mining companies, including some of the largest in the world. India, meanwhile, brings a distinct comparative advantage: a track record of scaling manufacturing at lower cost, an increasingly assertive industrial policy, and one of the fastest-growing demand centers for critical minerals. In 2025, the country launched a National Critical Minerals Mission to expand domestic processing, manufacturing, and recycling capacity.
The roles of these three countries are, in principle, complementary. Australia’s resource base and mining history, Canada’s resource base as well as its mining and industrial capabilities, and India’s market scale and commitment to value-added manufacturing could support diversification across multiple stages of the value chain. Officials from the three governments are expected to meet in early 2026 to establish workstreams covering technology standards, minerals cooperation, innovation ecosystems, and clean energy supply chains. The ambition extends beyond resource trade, seeking to link extraction, processing, technology co-development, and downstream manufacturing.
Execution, however, will be decisive. Existing processing hubs benefit from economies of scale and integrated downstream ecosystems that are difficult to replicate quickly. Significant capital, reliable infrastructure, stable regulatory environments, and long-term offtake agreements will be essential. While governments can support diversification through financing, co-investment, and policy coordination, private firms will ultimately determine whether the economics justify large scale investments. Early indicators of progress will include offtake agreements, vertical integration across supply chains, the mobilization of investment, the creation of joint ventures, regulatory alignment, and concrete collaboration in processing and advanced manufacturing. Even incremental progress would matter if it expands sources of supply and gradually reduces concentration risks over time.
Holly Stevens and Siddharth Sharma are Associates with McLarty Associates.