Brazil and India Strengthen Cooperation on Critical Minerals: The Global South Reshapes the Rare Earth Supply Chain

On February 21, 2026, Brazilian President Lula and Indian Prime Modi jointly attended a signing ceremony in front of the Indian Presidential Palace in New Delhi. With over ten ministers and large business delegations from both countries present as witnesses, the two sides signed a Memorandum of Understanding on cooperation in critical minerals and rare earths. While the document itself is not legally binding, it reflects a significant coordination in resource strategy between two major emerging economies. Brazil possesses the world's second-largest reserves of rare earths, and India is actively seeking to reduce its dependence on China's rare earth supply. The summit held in New Delhi has implications that extend beyond the text of an agreement; it demonstrates that resource-rich countries and major manufacturing nations are redefining their collaborative pathways against the backdrop of global trade fluctuations and intensifying technological competition.

Agreement Content and Strategic Intent

According to reports from the Associated Press and Brazil's G1 media, the core of this memorandum of understanding is to establish a cooperation framework covering two-way investment, exploration, mining, and the application of artificial intelligence in the mining industry. Brazilian diplomat and Secretary for Asia and Pacific Affairs, Susan Kleebank, stated before the talks that the leaders of both sides will also exchange views on the challenges facing multilateralism and international trade. This is not just empty diplomatic rhetoric. In 2025, both India and Brazil were affected by U.S. tariff measures, with the Trump administration once imposing a 50% tariff on Brazilian exports, which was related to Brazil's trial of former President Bolsonaro. Although most of these tariffs were later lifted, the shock from the incident persists.

Roberto Goulart Menezes, a professor of international relations at the University of Brasília, pointed out that it was the friction with the United States last year that prompted Brazil to place rare earths and critical minerals on the negotiation agenda. Brazil has begun to recognize the importance of these elements not only from a commercial perspective but also in terms of their geopolitical value. From India's perspective, the demand is even more urgent. Rishabh Jain, an expert at the Indian think tank Council on Energy, Environment and Water, analyzed that India's cooperation with Brazil on critical minerals complements its recent supply chain collaborations with the United States, France, and the European Union. These partnerships can bring technology, funding, and processing capabilities to India, but the Global South alliance is crucial for ensuring diversified resource access and influencing emerging global trade rules.

Data shows that Brazil is already India's largest trading partner in Latin America. Bilateral trade exceeded $15 billion in 2025, with a target to reach $20 billion by 2030. Brazil's main exports to India include sugar, crude oil, vegetable oil, cotton, and iron ore. India's rapid infrastructure construction and industrial growth, particularly its potential to become the world's fourth-largest economy, are driving sustained demand for iron ore. Now, the cooperation list has added more strategic items: 17 rare earth elements used in electric vehicles, solar panels, smartphones, aircraft engines, and guided missiles.

Resource Landscape and China's Presence

Any discussion about rare earths inevitably revolves around China. China currently dominates the global mining, separation, and processing of rare earths, a dominance that has raised supply chain concerns for many countries, including India. India is expanding domestic production and recycling efforts while seeking new supply sources worldwide. Brazil's emergence comes at an opportune time. According to data cited by both parties at the time of the agreement signing, Brazil holds the world's second-largest reserves of rare earths, granting it significant bargaining power and strategic leverage.

However, having reserves does not equate to having production capacity. From geological exploration and mine development to complex separation and purification technologies, building a complete industrial chain requires time, substantial investment, and expertise. This is precisely where India could offer assistance. India has advantages in information technology, engineering services, and certain high-end manufacturing sectors. Cooperation between the two sides could extend beyond simple ore trade to encompass technology sharing and joint research and development. Oliver Stuenkel, a professor of international relations at the Getulio Vargas Foundation in Brazil, believes this agreement is part of a broader strategy by both countries aimed at reducing dependence on China and the United States through diversification. The current understanding is that, given the turbulent and unpredictable situation, the more partners, the better.

The approach of de-risking is not an isolated case. India's recent diplomatic moves indicate that it is attempting to build a balanced network of relations between East and West, as well as between developed and developing countries. Cooperation with Brazil can be seen as a concrete practice of India's Global South diplomacy and its concept of strategic autonomy. For the Brazilian government under Lula, deepening relations with emerging powers like India is also part of its effort to play a greater role on the international stage and promote a multipolar world. During this visit, Lula led a large delegation that included ministers of foreign affairs, finance, health, and agriculture. He himself described it as potentially the largest delegation in his visits abroad, which in itself sends a clear political signal.

Geoeconomic Impact and Practical Challenges

The collaboration between Brazil and India will have implications that extend to a broader scope. Firstly, it may accelerate the integration of other resource-rich yet underdeveloped regions (such as some African countries) into the global critical minerals supply chain. Secondly, this partnership will exert certain pressure on the existing rare earth market landscape. Although it is unlikely to alter China's dominance in the short term, it provides downstream manufacturers with more supply options and greater confidence. Furthermore, as founding members of the BRICS group, Brazil-India cooperation may add new dimensions to the organization's practical collaboration, shifting from macro-political coordination to specific industrial and technological partnerships.

The agreement also faces significant challenges. Insufficient infrastructure is the primary issue. Many of Brazil's potential rare earth deposits are located in remote Amazon regions, and development requires the construction of extensive transportation and logistics networks, inevitably involving complex environmental assessments and indigenous rights issues. The conflict between environmental protection and resource development will persist in the long term. Secondly, establishing a complete industrial chain from mines to the market requires long-term stable policies and financial support. Whether the two countries can navigate changes in domestic political and economic cycles and maintain strategic patience remains to be seen. Finally, price fluctuations in the international market and rapid changes in technological pathways (such as advancements in recycling technology or the emergence of alternative materials) could all impact the economic viability of mineral extraction.

From a broader perspective, this collaboration serves as an example of the evolving globalization process. As efficiency-based single supply chains are supplemented by resilience-oriented diversified networks, traditional geographical distances and bloc boundaries are being bridged by new functional partnerships. Brazil and India—one spanning the Atlantic, the other overlooking the Indian Ocean—are connected by their shared demand for critical minerals. As Brazilian diplomat Klibank noted, the search for answers to the pressures facing the multilateral trading system may well lie in such flexible, pragmatic, and interest-based South-South cooperation.

After signing the agreement, Lula stated that increasing investment and cooperation in renewable energy and critical minerals is the core of the agreement we signed today. A few days later, he will travel to Washington to meet with the President of the United States. Professor Menezes from the University of Brasília believes that for Brazil, this agreement with India serves as a test before negotiating with countries of asymmetric power (implying the United States). On the global chessboard of critical minerals, new pieces have been placed, and the situation is becoming more complex.