Red Metal Boom: Can India Produce Enough Copper To Meet Rising Demand?

Synopsis: India’s copper demand is set to skyrocket, with BESS consumption alone projected to surge from 0.24 thousand tonnes in 2024-25 to over 56 thousand tonnes by 2029-30. Despite 163.89 million tonnes of ore reserves, domestic production lags, raising questions about supply security. Can India meet this red metal boom?

Copper is a vital, cross-cutting mineral that forms the backbone of energy transition efforts aimed at achieving net-zero greenhouse gas emissions. The shift toward renewable energy for power generation and the electrification of the global vehicle fleet are central to this transition, and both rely heavily on copper. 

Beyond its role in renewable technologies such as wind, solar, battery storage, and electric vehicles, copper remains crucial for traditional applications, including power generation, transmission, distribution, construction, and various end-use sectors.

Global demand for refined copper is projected to rise from 26.5 million tonnes in 2023 to 50 million tonnes by 2050, fueled by the energy transition, the expansion of digital infrastructure, and rapid industrial growth (International Copper Association, 2023).

The Copper Value Chain 

The copper value chain involves several stages, beginning with exploration and extending to final end-use applications. Once a mining site is identified and allocated, copper ore undergoes crushing, grinding, and beneficiation to produce concentrates containing 20 percent to 30 percent copper.

Copper ores are categorized into oxides and sulphides. Oxide ores are more common but generally lower in grade and are processed using hydrometallurgical methods involving aqueous solutions. Sulphide ores, on the other hand, contain higher copper content but require pyrometallurgical processing, which involves heating the ore. 

The resulting concentrates, containing 26 percent to 32 percent copper, are smelted to create molten matte with 58 percent to 60 percent copper, which is then converted into blister copper of 98 percent purity. Further refining through electrolysis or electrowinning removes remaining impurities, producing high-purity cathodes exceeding 99.99 percent copper.

These cathodes are then manufactured into semi-finished products such as wires, rods, and sheets, which serve as critical inputs for multiple industries before reaching their final applications.

Copper mining and processing are concentrated in a small number of countries that account for a substantial portion of global output. In 2023, global mined copper was estimated at 22 million tonnes, while refined copper production reached approximately 27 million tonnes (USGS, 2024). Chile led global mined copper production with 5 million tonnes, followed by Peru at 2.6 million tonnes and the Democratic Republic of Congo (DRC) at 2.5 million tonnes, collectively accounting for about 46 percent of the world’s mined copper (Figure 3). The refining sector is even more concentrated, with China dominating over 44 percent of global copper refining.

Demand For Copper In India 

In the energy transition sector, copper demand projections for wind, solar, and Battery Energy Storage Systems (BESS) indicate a realistically attainable trajectory based on historical patterns and recent developments. These projections correspond to the additional installation of solar panels, wind turbines, and BESS over the forecast period. Notably, copper demand from wind energy is expected to rise by 178 percent by FY 2027. This surge is partly driven by the need to decommission or repower wind turbines installed in 2007, given the average 20-year operational lifespan of a turbine.

Electric vehicles (EVs) also represent a major driver of copper demand, as they incorporate copper in batteries, motors, wiring, cables, and power electronics. Demand projections for EVs are based on expected sales of electric two-wheelers, three-wheelers, and cars. Additionally, government programs such as PM E-Sewa and E-Drive are projected to support the deployment of 24,028 e-buses by 2030, which would require roughly 6,800 tonnes of copper.

Battery Energy Storage Systems, essential for grid stability and energy storage, are another significant contributor to future copper demand. Achieving India’s interim climate goals, including 500 GW of nonfossil fuel capacity and a 50 percent renewable energy share by 2030, is expected to trigger a sharp increase in copper consumption for BESS by 2030.

While conventional sectors will continue to account for the largest portion of absolute copper demand, the renewable energy sector is expected to see faster growth in copper usage. However, advancements in technology, greater resource efficiency, and higher recycling rates are likely to reduce the copper intensity of green energy applications.

Demand Statistics In India 

In India, alongside growth in conventional renewables and electric vehicles (EVs), copper demand from Battery Energy Storage Systems (BESS) is expected to increase at an exceptionally rapid pace. Although initial demand is modest at 0.24 thousand tonnes in 2024-25, it is projected to escalate sharply to over 56 thousand tonnes by 2029-30. This dramatic rise underscores the vital role of large-scale energy storage solutions in ensuring grid stability and enabling the integration of renewable energy. 

The growth in BESS-related copper consumption is particularly significant because it accelerates in the latter half of the decade, highlighting storage technologies as one of the fastest-growing segments in India’s copper demand landscape. Combined with steady demand growth from EVs and renewable energy, this exponential increase in BESS consumption reinforces copper’s strategic importance in India’s energy transition and points to the need for careful planning around supply, recycling, and sourcing of this critical metal.

Overall, these projections indicate a structural shift in India’s copper demand, driven by decarbonization, electrification, and the expansion of renewable energy. Policy measures supporting EV adoption, solar capacity growth, and large-scale energy storage will be key determinants of copper consumption patterns. 

Rising demand across multiple sectors also presents potential challenges for domestic supply and emphasizes the importance of long-term planning in copper sourcing, imports, and recycling initiatives. For industry stakeholders, understanding these trends is essential to anticipate future investment requirements, manage supply chain dynamics, and capitalize on opportunities within India’s rapidly evolving energy ecosystem.

Key Players In India

Key players in India’s copper sector include both public and private companies, each contributing differently across the value chain. Hindustan Copper Limited (HCL), a public sector integrated producer with an installed capacity of 68,500 tonnes, has phased out cathode production since 2020 and currently sells copper concentrates in the open market as well as in bulk to Hindalco under a public-private partnership agreement. 

Hindalco, operating through its Birla Copper division, is a private port-based custom smelter with an annual capacity of 500,000 tonnes and supplies over half of India’s domestic refined copper requirements. Vedanta’s Sterlite Copper, also a private port-based smelter with a total capacity of 460,000 tonnes, has not operated its Tuticorin facility, which accounts for 400,000 tonnes, since 2018. Adani’s Kutch Copper Ltd. is entering the sector with a private port-based smelter targeting a total capacity of 1 million tonnes, with the first 500,000-tonne unit of Phase 1 commissioned in March 2024.

Can India Produce Enough Copper?

India’s copper sector is at a critical stage, facing a widening gap between domestic demand and supply across the value chain. Despite having significant reserves of 163.89 million tonnes of ore containing 2.16 million tonnes of metal, and total resources of 1.66 billion tonnes, the country relies heavily on imports to meet refined copper needs. 

Hindustan Copper Limited (HCL), the sole integrated copper producer, As of FY2023, It operates five mines with combined ore reserves of 698.44 million tonnes, yet its current annual ore production of 3.8 million tonnes remains far below the stated expansion targets of 12.2 MTPA by FY 2031. The underperformance stems from exhausted or ageing mines, outdated technology, logistical inefficiencies, and delays in statutory clearances. HCL’s exploration and expansion efforts have been limited, and private sector participation remains minimal due to uncertainties around mineral concessions and low commercial viability.

In the midstream segment, domestic refined copper production is dominated by Hindalco and Vedanta, collectively producing approximately 509,000 tonnes of cathodes in 2023-2024, far below the peak of 830,500 tonnes in FY 2017-2018. The closure of Vedanta’s Sterlite Tuticorin plant in 2018 transformed India into a net importer of copper cathodes, reducing domestic midstream resilience. HCL’s gradual exit from processing has created opportunities for private players, but also underscores structural weaknesses. 

Hindalco’s Dahej facility produced 368,000 tonnes of cathodes in FY 2023-2024, reflecting a ten percent decline from the previous year, while Vedanta’s Silvassa plant contributed 141,000 tonnes during the same period. The entry of Kutch Copper Ltd., with its 1-MTPA plant under phased commissioning, is expected to ease supply pressures over the next five years. However, domestic demand is already growing across sectors such as renewable energy, electric vehicles, air conditioning, and electronics, suggesting a continued gap between supply and demand in the near term.

Can India Meet Growing Copper Demand?

India’s downstream copper sector faces additional constraints, as it depends on upstream and midstream supplies for value-added production. Domestic manufacturing of wires, cables, and copper-based components is fragmented and often less price-competitive compared to imports.

The 2023 Quality Control Order (QCO) mandates BIS certification for imported copper products to ensure quality, but delays in approvals exacerbate supply bottlenecks. Enhancing vertical integration, adopting advanced processing technologies, and digitalisation could strengthen domestic downstream capabilities, but these require significant investment and policy support.

On the global front, India must navigate supply challenges due to the concentration of copper production and processing in countries such as China, Australia, and Zambia. Strategic international collaborations and investment in overseas mines can partially offset domestic constraints.

Examples include Vedanta’s Konkola operations in Zambia and Adani’s supply agreements with BHP for Kutch Copper, though the scale of these efforts is limited relative to national demand.

Incentive schemes like the Production-Linked Incentive (PLI) program stimulate downstream copper usage in electronics, ACC batteries, and white goods, indirectly supporting demand growth. However, PLI benefits can be availed even with imported raw materials, providing limited support for domestic upstream and midstream development. Without simultaneous expansion of domestic mining, beneficiation, and smelting capacities, India will continue to rely on imports, exposing the economy to price volatility and global supply chain risks.

In conclusion, while India has substantial copper resources and ongoing plans to expand mining and processing capacities, structural inefficiencies, delayed projects, and limited private participation restrict its ability to fully meet domestic demand. In the near term, India will remain a net importer of copper.

Achieving long-term supply security requires a coordinated approach integrating upstream exploration, midstream processing, downstream manufacturing, policy support, and international partnerships to ensure both sustainable supply and value creation.

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