At exactly 20 minutes into her speech, Union Finance Minister Nirmala Sitharaman formally declared war on China. The intent to take on the Asian giant was made so subtly that it could have been mistaken for a routine budget proposal had it not been for the Economic Survey that was released a day ago on January 31.

Here is what the minister said at the 20th minute of her speech on February 1. "Given our commitment to climate-friendly development, the Mission (Make in India) will also support Clean Tech manufacturing. This will aim to improve domestic value addition and build our ecosystem for solar PV cells, EV batteries, motors and controllers, electrolysers, wind turbines, very high voltage transmission equipment and grid-scale batteries."

That was all, but it was her way of telling China that India would no longer take its business tyranny lying down. India wants to take on the challenge of climate change but is unwilling to do it on China's terms. "As the world navigates the challenges of climate change, the road to energy transition runs through China," the Economic Survey 2024-25 had noted, in a sense saying that the world was caught napping.

The danger was officially acknowledged by India three years ago. A Press Information Bureau (PIB) release of the Ministry of Environment, Forest and Climate Change on February 3, 2022, had this to say: "Over the last decade, global solar photovoltaic cell (PV) manufacturing capacity has increasingly moved from Europe, Japan and the United States to China, which has invested more than 50 billion US dollars in new PV supply capacity – ten times more than Europe."

Taking a cue, the latest Economic Survey noted that the dominance of China in the environmental goods sector deserved serious consideration. "China's share of solar panels (polysilicon, ingots, wafers, cells, and modules) exceeds 80% in all the manufacturing stages," the Survey noted.

This is a globally recognised fact. International Energy Agency's Special Report on Solar PV Global Supply Chains said in 2022 that China was home to the world's top 10 suppliers of solar PV manufacturing equipment.

This has brought the costs down but has led to the dangerous concentration of global supply chains of climate-resilient technology in one country: China. An international paper titled 'Visualizing China’s Dominance in Battery Manufacturing' says that China houses nearly 80% of the world's battery manufacturing capacity, pivotal to the energy transition.

A 2024 study on the 'State of global solar energy market: Overview, China's role, Challenges, and Opportunities' says that, on the solar front, China controls the supply of primary materials, manufacturing, installed capacity, and recycling capacity and produces at least 80% of the main components of PVs.

This is what a Goldman Sachs study, 'Resource realism: The geopolitics of critical mineral supply chains', noted in 2023: "China's vertical integration across the entire electric vehicle (EV) supply chain, from mining to EV manufacturing, has enabled it to retain its global dominance in this sector. It is also pertinent to note that about 70 per cent of the world's rare earth minerals, which are critical resources for high-storage batteries, are processed by Chinese companies."

By the time India has woken up, the dominance seems near absolute. In the 2023 Ministry of Mines report 'Critical Minerals of India', it is said that there were 33 critical minerals vital to India’s economic security and found that 24 are currently at high risk of supply disruptions.

China commands a significant share of critical mineral processing and production globally. "Across key commodities such as Nickel, Cobalt, and Lithium, China alone is responsible for processing 65 per cent, 68 per cent and 60 per cent of the global output, respectively," the Ministry of Mines report says. "Supply disruptions", therefore, is a euphemism for "at the mercy of China".

It is in this context that the Economic Review speaks of "policies for electric vehicles must focus on de-risking supply chains by promoting a more self-reliant ecosystem powered by increased R&D in advanced battery technologies, such as Sodium-ion and Solid-State Batteries."

The finance minister's support to 'Clean Tech Manufacturing' at the 20th minute of the speech is a sign that the union government had got the wake up call.

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