The UAE and India launch an aluminium supply chain

The United Arab Emirates and India join forces to make their mark on the aluminium market. The announcement of a joint investment of $11.5 billion between Adani Enterprises and the UAE-based International Holding Company (IHC) to build an integrated aluminium ecosystem in the state of Odisha, in eastern India, is not merely industrial news. It signals a major realignment in the sector of raw materials required for advanced manufacturing and, consequently, for the energy transition. The project involves the construction of a 4 million metric tonnes per annum alumina refinery, a 2-million-tonne smelter, a 1-million-tonne downstream industrial park and a very extensive energy infrastructure, comprising 4,000 megawatts of captive capacity and 400 megawatts of green energy.

The choice of Orissa is no coincidence. This Indian state boasts a concentration of mineral resources, availability of industrial land and logistical access to the sea. In a global context where value chains are increasingly exposed to geopolitical tensions, trade bottlenecks and protectionist pressures, building an integrated hub close to raw material sources and ports means gaining control, time and profit margins. But that is not all. The partnership with the Gulf is equally promising. IHC brings financial resources and a long-term investment approach, less focused on immediate market returns and more geared towards securing strategic assets. Adani, for its part, offers a strong local presence, infrastructure and an already well-established industrial platform in key sectors such as energy, logistics and raw materials. Together, the two groups aim to build a value chain that does not rely excessively on traditional Western economic structures.

The industrial partnership between India and the United Arab Emirates, which is also being fostered by CEPa – the partnership agreement between the two countries signed in 2022 – could be seen as a building block in the wider transformation of the economic order. This order is increasingly organised into regional hubs capable of integrating along strategic supply chains. In this context, the Orissa hub would represent a key piece of infrastructure for making aluminium production more self-sufficient – a metal considered essential for the manufacturing industry, the aerospace sector and the energy transition. It is used to make vehicles lighter, for electrical infrastructure, for packaging, for solar panels, and for numerous high-tech industrial applications. Producing aluminium requires enormous amounts of energy. The combination of thermal power and renewables, which forms the basis of the hub, seeks to address two seemingly conflicting requirements: ensuring operational continuity for an energy-intensive sector whilst, at the same time, preparing for stricter environmental standards on international markets.

The aim is clearly to process bauxite into a finished product, thereby reducing dependence on external suppliers. There are, of course, a number of unknowns. A project of this scale requires a long timeframe, authorisations, financial stability and complex logistics. Indeed, an investment of this magnitude is not measured solely by the price of aluminium, but also by the stability of trade routes, the cyber security of the plants and currency volatility. The reference to security is by no means secondary. Industrial facilities of this nature are digital as well as physical systems: control networks, software, automation and remote management. This exposes them to new vulnerabilities, ranging from cyber-sabotage to industrial espionage. Similarly, dependence on port links and ocean routes makes the protection of logistics a key priority. It is too early to say to what extent the joint venture and the downstream project might fit into the wider geopolitical landscape, or how they might influence the strategic autonomy of the two countries, or even how they might fit into the broader framework of the IMEC corridor. However, the path seems to be leading in this direction.