How China Has Become World’s ‘Lithium King’, And What India Must Learn Before It’s Too Late

Last Updated:September 12, 2025, 12:55 IST

China refines about 70% of the world’s lithium, turning raw ore into battery-grade material. Securing raw materials, refining capacity is something India can learn from China

Batteries are the oil barrels of the 21st century. Whoever controls them controls the pace of electrification, clean energy, and even geopolitics. (Getty Images)

China’s dominance in lithium and batteries did not happen by accident. It is the result of decades of planning, subsidies, and relentless execution. From mining to refining, from cell chemistry to megafactories, Beijing has built a supply chain so deep and wide that no other country comes close.

Today, China commands the critical resource of the electric age the way oil giants once controlled crude.

But how did it get here? What does China plan to do next? And where does India fit in this race for the future of energy?

The Rise Of China As A Lithium Superpower

Mining Muscle

By 2026, China is expected to overtake Australia as the world’s largest lithium miner, pulling in up to 10,000 more metric tonnes of lithium a year. While Australia has richer reserves, China has leveraged overseas investments—in Latin America’s Lithium Triangle and Africa’s mineral belt—to secure resources that feed its domestic industry.

Refining Dominance

Even more important than mining is refining. China refines about 70% of the world’s lithium, turning raw ore into battery-grade material. This chemical processing stage is where the value multiplies, and Beijing has ensured that most of it happens within its borders.

Battery Ecosystem

China’s battery industry is enormous. In 2024, it produced 1,170 GWh of lithium-ion batteries—over three-quarters of global output. That scale is powered by domestic demand: China sells more than 11 million electric vehicles (EVs) a year, giving its factories the perfect home market to lower costs and improve efficiency.

Add to this government subsidies, cheap credit, and vast industrial parks dedicated to EVs and energy storage, and you get the picture: China is not just participating in the global battery race, it is writing the rules.

Why China’s Strategy Works

Vertical Integration: Beijing has built an end-to-end chain, from mines to materials to batteries to EVs. That means lower costs and less reliance on imports.

Policy Backing: Long-term government policies such as the New Energy Vehicle plan and industrial subsidies created certainty for investors.

Massive Scale: Gigantic EV demand at home allowed factories to achieve economies of scale faster than competitors in the US, Europe, or India.

Technological Shift: China invested heavily in alternative chemistries like LFP (Lithium Iron Phosphate), which are cheaper, safer, and rely less on scarce cobalt and nickel.

What China Plans Next

Having secured its position as the “Lithium King”, Beijing is preparing for the next phase:

Expansion of mining abroad: Chinese firms are doubling down on stakes in lithium mines across Argentina, Chile, and Africa to ensure a steady supply even as demand soars.

Sodium-ion batteries: China is betting big on sodium-ion technology, which could rival lithium for some energy storage and low-cost EV applications. This would reduce pressure on lithium reserves while maintaining dominance in the broader battery market.

Recycling and second life: Large Chinese firms are investing in recycling hubs to recover lithium, cobalt, and nickel from used batteries—turning waste into a fresh supply stream.

Global export control: China has already imposed curbs on the export of certain advanced battery technologies. By keeping the know-how at home, Beijing ensures competitors remain dependent.

Pushing LFP worldwide: CATL and BYD, China’s battery giants, are exporting LFP batteries globally. By promoting cheaper chemistries, China is reshaping global EV economics in its favour.

Simply put, China is not just defending its lead—it is expanding into new chemistries, locking in resources abroad, and future-proofing its battery empire.

What Is India’s Dilemma?

India is a fast-growing EV market, but it lags in batteries. Nearly every EV sold in India depends on imported cells, mostly from China. For a country that dreams of energy independence, this is a strategic weakness.

So, what should India learn from China’s playbook?

Secure raw materials: India must accelerate lithium exploration at home (like the reserves found in Jammu & Kashmir, Rajasthan and Chhattisgarh) and invest in mining assets abroad.

Refining capacity: Mining alone will not help—India needs refineries to convert ore into battery-grade material. Otherwise, the value will escape overseas.

Gigafactories with scale: India has announced plans for several gigafactories, but most are still on paper. Without scale, Indian EV makers will always face high battery costs.

Stimulate demand: Incentives for EV buyers, charging infrastructure, and lower GST can create a bigger domestic market, which in turn will support manufacturing scale.

Invest in R&D: India must not play catch-up forever. Investing in sodium-ion, solid-state, and advanced recycling could allow India to leapfrog into next-generation technologies.

Balance environment and growth: Mining and refining are polluting processes. India needs cleaner tech and stricter safeguards to avoid ecological damage.

What Are The Risks India Must Watch?

Resource scarcity: India has far smaller lithium reserves compared to China.

High costs: Power, land, and compliance are more expensive in India, raising production costs.

Global dependencies: Even China imports some raw ore. India, without strong foreign partnerships, risks being squeezed by supply shocks.

Delayed policy: Announcements alone will not close the gap. India needs consistent long-term policies, not stop-start incentives.

The Lithium Race Is Hotting Up

Batteries are the oil barrels of the 21st century. Whoever controls them controls the pace of electrification, clean energy, and even geopolitics. Australia, Chile, China and Zimbabwe lead in lithium reserves, while China, alone, is the top manufacturer of lithium batteries in the world. It is expected to be a dominant force in lithium-ion battery production by 2030, claiming nearly 70% of global capacity.

For India, building a domestic battery ecosystem is about more than cheaper EVs— it is about energy security, strategic autonomy, and economic opportunity. Millions of jobs, cleaner air, and lower import bills are at stake.

Shilpy Bisht

Shilpy Bisht, Deputy News Editor at Mobile News 24×7 Hindi, writes and edits national, world and business stories. She started off as a print journalist, and then transitioned to online, in her 12 years of experience. Her prev…Read More

Shilpy Bisht, Deputy News Editor at Mobile News 24×7 Hindi, writes and edits national, world and business stories. She started off as a print journalist, and then transitioned to online, in her 12 years of experience. Her prev… Read More

But how did it get here? What does China plan to do next? And where does India fit in this race for the future of energy?

The Rise Of China As A Lithium Superpower

Mining Muscle

By 2026, China is expected to overtake Australia as the world’s largest lithium miner, pulling in up to 10,000 more metric tonnes of lithium a year. While Australia has richer reserves, China has leveraged overseas investments—in Latin America’s Lithium Triangle and Africa’s mineral belt—to secure resources that feed its domestic industry.

Refining Dominance

Even more important than mining is refining. China refines about 70% of the world’s lithium, turning raw ore into battery-grade material. This chemical processing stage is where the value multiplies, and Beijing has ensured that most of it happens within its borders.

Battery Ecosystem

China’s battery industry is enormous. In 2024, it produced 1,170 GWh of lithium-ion batteries—over three-quarters of global output. That scale is powered by domestic demand: China sells more than 11 million electric vehicles (EVs) a year, giving its factories the perfect home market to lower costs and improve efficiency.

Add to this government subsidies, cheap credit, and vast industrial parks dedicated to EVs and energy storage, and you get the picture: China is not just participating in the global battery race, it is writing the rules.

Why China’s Strategy Works

Vertical Integration: Beijing has built an end-to-end chain, from mines to materials to batteries to EVs. That means lower costs and less reliance on imports.

Policy Backing: Long-term government policies such as the New Energy Vehicle plan and industrial subsidies created certainty for investors.

Massive Scale: Gigantic EV demand at home allowed factories to achieve economies of scale faster than competitors in the US, Europe, or India.

Technological Shift: China invested heavily in alternative chemistries like LFP (Lithium Iron Phosphate), which are cheaper, safer, and rely less on scarce cobalt and nickel.

What China Plans Next

Having secured its position as the “Lithium King”, Beijing is preparing for the next phase:

Expansion of mining abroad: Chinese firms are doubling down on stakes in lithium mines across Argentina, Chile, and Africa to ensure a steady supply even as demand soars.

Sodium-ion batteries: China is betting big on sodium-ion technology, which could rival lithium for some energy storage and low-cost EV applications. This would reduce pressure on lithium reserves while maintaining dominance in the broader battery market.

Recycling and second life: Large Chinese firms are investing in recycling hubs to recover lithium, cobalt, and nickel from used batteries—turning waste into a fresh supply stream.

Global export control: China has already imposed curbs on the export of certain advanced battery technologies. By keeping the know-how at home, Beijing ensures competitors remain dependent.

Pushing LFP worldwide: CATL and BYD, China’s battery giants, are exporting LFP batteries globally. By promoting cheaper chemistries, China is reshaping global EV economics in its favour.

Simply put, China is not just defending its lead—it is expanding into new chemistries, locking in resources abroad, and future-proofing its battery empire.

What Is India’s Dilemma?

India is a fast-growing EV market, but it lags in batteries. Nearly every EV sold in India depends on imported cells, mostly from China. For a country that dreams of energy independence, this is a strategic weakness.

So, what should India learn from China’s playbook?

Secure raw materials: India must accelerate lithium exploration at home (like the reserves found in Jammu & Kashmir, Rajasthan and Chhattisgarh) and invest in mining assets abroad.

Refining capacity: Mining alone will not help—India needs refineries to convert ore into battery-grade material. Otherwise, the value will escape overseas.

Gigafactories with scale: India has announced plans for several gigafactories, but most are still on paper. Without scale, Indian EV makers will always face high battery costs.

 

Stimulate demand: Incentives for EV buyers, charging infrastructure, and lower GST can create a bigger domestic market, which in turn will support manufacturing scale.

Invest in R&D: India must not play catch-up forever. Investing in sodium-ion, solid-state, and advanced recycling could allow India to leapfrog into next-generation technologies.

Balance environment and growth: Mining and refining are polluting processes. India needs cleaner tech and stricter safeguards to avoid ecological damage.

What Are The Risks India Must Watch?

Resource scarcity: India has far smaller lithium reserves compared to China.

High costs: Power, land, and compliance are more expensive in India, raising production costs.

Global dependencies: Even China imports some raw ore. India, without strong foreign partnerships, risks being squeezed by supply shocks.

Delayed policy: Announcements alone will not close the gap. India needs consistent long-term policies, not stop-start incentives.

The Lithium Race Is Hotting Up

Batteries are the oil barrels of the 21st century. Whoever controls them controls the pace of electrification, clean energy, and even geopolitics. Australia, Chile, China and Zimbabwe lead in lithium reserves, while China, alone, is the top manufacturer of lithium batteries in the world. It is expected to be a dominant force in lithium-ion battery production by 2030, claiming nearly 70% of global capacity.

For India, building a domestic battery ecosystem is about more than cheaper EVs— it is about energy security, strategic autonomy, and economic opportunity. Millions of jobs, cleaner air, and lower import bills are at stake.

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