New Delhi [India], June 16 (ANI): India is actively engaging with China both commercially and diplomatically to address concerns related to the supply of rare earth minerals, Commerce Secretary Sunil Barthwal said on Monday. The government is taking comprehensive steps to ensure the continuity of essential imports critical to key sectors such as automotive and electronics.
Barthwal noted that India is working closely with major industry stakeholders, including the Society of Indian Automobile Manufacturers (SIAM) and the Automotive Component Manufacturers Association (ACMA), to assess the impact of China’s recent export restrictions. “We’re engaged with SIAM and ACMA, facilitating them to have discussions with their Chinese counterparts,” he stated.
He further emphasized that China’s recent move was part of a broader global strategy, not specifically targeted at India.
The Ministry of External Affairs (MEA) is also in direct communication with the Chinese government through diplomatic channels to restore predictability in the supply chain. MEA spokesperson Randhir Jaiswal said last week, “We are in touch with the Chinese side, both here in Delhi and in Beijing, to bring predictability in the supply chain for trade, consistent with international practices.”
Commerce and Industry Minister Piyush Goyal, speaking from Switzerland during an official visit, described China’s restrictions as a “wake-up call” for the global community, highlighting India’s ongoing efforts to develop alternative supply chains. Goyal reiterated India’s commitment to positioning itself as a trusted global trade partner and reducing its dependency on Chinese suppliers.
The urgency stems from China’s near-monopoly in global rare earth processing—accounting for over 90% of the world’s magnet production capacity. These materials are vital for the functioning of numerous high-tech industries, including automobiles, home appliances, and renewable energy systems.
Under new regulations effective April 4, China requires special export licenses for select rare earth elements and magnetic products, which has led to shipment delays and concerns over potential supply disruptions.
In response, India is also exploring strategic partnerships outside China. At the India-Central Asia Dialogue, countries including Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan expressed interest in joint exploration of rare earth and other critical minerals.
Meanwhile, a recent report by Crisil Ratings warned that prolonged disruption in rare earth magnet supplies could become a major bottleneck for India’s electric vehicle (EV) industry. According to the report, a supply delay of more than a month could negatively impact new EV launches, hinder production, and slow sectoral growth.
Rare earth magnets are crucial for permanent magnet synchronous motors (PMSMs) used in EVs due to their high efficiency, compact design, and superior torque. These components are equally important in hybrid vehicles and numerous clean energy technologies.
As India navigates the challenge, it is banking on both strategic diplomacy and industrial resilience to secure vital resources and maintain momentum in key sectors. (ANI)
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