China leads the safari on cobalt
As New Delhi struggles to shape its strategy on tapping cobalt in the Congo, Beijing has already become the dominant player in mining the shiny grey metal used to make lithium-ion batteries that power electric cars and smartphones.
N’sala, he was called, the man in the photo which didn’t shock the world. “He hadn’t made his rubber quota for the day”, writer and photographer Alice Seeley Harris recorded in 1904, “so the Belgian-appointed overseers had cut off his daughter’s hand and foot. Her name was Boali. She was five years old. Then they killed her. But they weren’t finished. They killed his wife as well. And because that didn’t seem quite cruel enough, quite strong enough to make their case, they cannibalised both.”
“And they presented N’sala with the tokens, the leftovers from the once living body of his darling child whom he so loved.”
Now, six decades after the Democratic Republic of Congo gained independence from Belgium, the war-torn and politically-volatile country is once again at the heart of one of the world’s great resource-races. The country is home to more than 60 per cent of the world’s cobalt—the hard, shiny grey metal that lies at the heart of the rechargeable batteries powering the next generation of cars, homes and even aircraft.
India’s hopes of transforming its economy rest, in many ways, on secure and stable access to the metal. The good news is New Delhi finally seems to be warming up at the starting block for the race to get it. The bad news is that its showed up ten years after the starting whistle was blown.
FUTURE IS ELECTRIC
Last year, the government announced plans to make a third of India’s vehicle fleet electric by 2030—part of a sweeping push to green India’s energy consumption. The logic is sound, and not just because it will make our air cleaner. Ever since 2008, hydrocarbon prices have been falling thanks in part to shale oil and gas finds in North America. But India is importing ever-growing volumes, making it reliant on crisis-prone West Asia. India has to compete, moreover, with other energy-hungry Asian economies notably China.
“The future is electric,” Union minister of state for new and renewable energy RK Singh recently said. Noting that the average per-kilometre running cost of an electric car is just 0.85 to 6.50 for hydrocarbon variants, Singh said that going electric would “help us achieve autonomy from expensive petroleum imports”.
Like most things in life, though, there’s a catch. Ten kilogrammes, or so, of the hard, grey metal go into making a single car battery. The government’s most recent records, to the end of 2017, show India has 229,650,234 motor vehicles—which means the demand from this sector alone will be gargantuan.
Following the electric car decision, a Cabinet note—the bureaucratic briefs that facilitate decision-making at the highest levels—has been prepared, laying out India’s need for cobalt. The National Security Council Secretariat has also commissioned studies. In one, seen by Firstpost, the NSCS noted that there is “no production of cobalt in the country from indigenous ores”
India’s estimated reserves of 44.91 million tonnes are trivial given the need; worse, they’re locked up in Odisha and Nagaland, where local resistance to mining is high. “There’s also the problem that cobalt mining involves toxic residues,” says an official involved in the studies for the Cabinet, “which means local resistance will be stiff.”
Energy Ministry officials say they’re now working to set up a consortium involving the National Aluminium Company, Hindustan Copper and the Mineral Exploration Corporation that will work overseas to tie up sources of rare metals, including cobalt and lithium. Talks have begun with Australia and Peru, both of which have reserves.
But as India struggles to shape a strategy, China has already cornered giant swathes of the Congo’s cobalt—and is moving fast to lock in the rest.
THE CONGO-CHINA PARTNERSHIP
China’s involvement in the Congo’s cobalt is staggering. Eight of the Congo’s largest mining operations—Tenke Fungurume, Congo Dongfang, Ruashi, Kamoya, Metal, MJM, MKM and Sicomines—are Chinese-owned. Together, they accounted for almost 49 per cent of the Congo’s cobalt output last year, which in turn made up 68 per cent of global production. In addition, Shezhen-based GEM announced last year that it had contracted with global cobalt giant Glencore for 50,000 tonnes over three years—about half of the entire world production in 2018.
The invention of the internal combustion engine ensured European and United States supremacy in cars, railways and aeronautics for a century—a supremacy it cemented with political control of crude oil in West Asia.
Beijing is determined that its companies—already the biggest battery suppliers in the world—will dominate the age of electric transport. Its presence in the Congo is meant to ensure no one else muscles in.
Following the success of Tesla’s gigafactory in Nevada, companies like Contemporary Amperex Technology have been mushrooming across China building similar operations that aim to exceed it in scale and ambition.
Laurent Kabila, the recently-removed Congolese president, was the key instrument of China’s rise. Trained at the People’s Liberation Army’s National Defence University, Kabila found reliable partners in Beijing who were willing to overlook his less-than-edifying human rights records.
Kabila succeeded in building a fortune through the relationship albeit at the expense of a population which still lives on just $1.25 a day.
The Congo Research Group, an independent research body, revealed in one report that Kabila and his siblings were at the centre of a web of companies with stakes in the mining sector, involving multi-million dollar revenues. Global Witness, another transparency watchdog, estimated that, at least, $750 million—about a fifth of the Congo’s mining revenues—was misappropriated between 2013 and 2015.
“Central Africa’s giant holds the continent’s richest mineral wealth,” analyst Aditi Lalbahadur noted in a recent paper . “Yet, having suffered war and violence for most of its history, its economy remains woefully underdeveloped and its people impoverished.”
A western mining business official familiar with the region says, “It didn’t take a lot to do business in the Congo. Basically, you needed a large suitcase and enough banknotes to fill it.” Beijing’s financial muscle helped Kabila ride out elections in 2005 and 2011, which were widely perceived as rigged. He sought to overturn a two-turn limit in 2016 arguing budgetary constraints and procedural problems meant elections could not be held.
Finally, this year, his hand-picked successor Felix Tshisekedi was declared winner in an election which both international observers as well as the country’s powerful Catholic church said had been won by opposition candidate Martin Fayulu. Kinshasa, the capital, has since been calling for civil disobedience.
Even if a democratic transition is secured, the chances that the Congo will stabilise are low. Eastern Congo, where much of the country’s mineral wealth sits, has seen running armed conflict in recent years on top of civil wars from 1996-1997 and then from 1998 to 2003. The region is controlled, on ground, by small, armed groups collectively known as Mai-Mai.
“Indian businesses just don’t have what it takes to operate in environments like these,” a Research and Analysis Wing official told Firstpost. “We just don’t have the infrastructure it needs like military contractors to provide security or the kinds of regional experts who can make the deals needed.”
“Beijing,” he said, “has spent years learning how to do this right, and is willing to pay the price.”
The 23 years of King Leopold II’s rule in the Congo, which ran from 1885-1908, is estimated to have cost the lives of 10 million Africans. From Adam Hochschild’s history, King Leopold’s Ghost, we know it involved the chopping off of hands and genitals, floggings and burning down entire villages. Figures like Alice Seeley Harris, Mark Twain, Joseph Conrad and Arthur Conan Doyle campaigned against these atrocities, but to little avail: the wealth generated by rubber was just too great.
Like Belgium’s savage rubber plantations, China’s relentless campaign to extract cobalt from the bowels of the earth is paid for with blood, and broken bodies. Twenty per cent, perhaps more, of the Congo’s cobalt is extracted by artisanal miners—untrained workers who dig in illegal tunnels, or in the tailings of industrial mines.
In addition to the hundreds of thousands of adults, the United Nations Children’s Emergency Fund reported in 2014 that the artisanal mines use upwards of 40,000 children who are paid just $1-2 for a 12-hour shift.
Amnesty International reported in 2016 that many suffered potentially-fatal condition called ‘hard metal lung disease’ as well as asthma, and decreased pulmonary function—a consequence of inhaling cobalt particles.
New Delhi’s strategic energy aims—reducing dependence of hydrocarbons and building a vibrant green-energy industry—require it to be actively engaged in the heart of Africa, where the metal that will shape the new era is to be found.
Yet, India has been absent from the global stages where the future of the Congo is being shaped. There’s no Indian voice in the growing global campaign to ensure batteries use ethically-sourced cobalt. Nor has New Delhi participated in multinational efforts to support a genuine democratic transition in Kinshasa—something which could constrain China’s quasi-imperial influence in the country.
“The cobalt story shows we just don’t have the institutional capital we need to secure our interests”, a senior Ministry of External Affairs official says.
“In China, there’s a host of companies working closely with the government to make gambles when needed. In India, we just don’t have corporations with that kind of risk-taking mindset nor a bureaucracy with the resources to help them,” the official adds.
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