India and Central Asia join forces: new Rare Earth exploration to counter China’s export curbs

China’s dominance in rare earth minerals, controlling 70% of mining and 90% of processing, has led to significant global supply vulnerabilities.

In response to China’s April 4 export restrictions on critical rare earths like samarium and dysprosium, India and Central Asian countries have joined forces to explore alternative sources, aiming to reduce dependence on Beijing.

The restrictions have severely impacted India’s automotive sector, especially electric vehicle production. Maruti Suzuki, the country’s largest passenger vehicle manufacturer, cut its e-Vitara production target by two-thirds due to shortages.

External Affairs Ministry spokesperson Randhir Jaiswal stated, “We are in touch with the Chinese side, both here in Delhi as also in Beijing to bring predictability in supply chain for trade, consistent with international practices.”

Commerce and Industry Minister Piyush Goyal called China’s export curbs a global “wake-up call,” emphasizing India’s efforts to build alternative supply chains and position itself as a trusted partner for international businesses.

India’s reliance on China for rare earth imports stands at 81%, but the country holds the world’s third-largest rare earth reserves at 6.9 million tonnes. The government plans to scale up mining and processing through the Critical Mineral Mission.

The collaboration with Central Asian nations, discussed at the recent India-Central Asia Dialogue, marks a strategic move to secure critical minerals and counter China’s export curbs, which have also caused a 37% drop in rare earth sales to the US and widespread industry concern.

This joint exploration effort aims to stabilize supply chains vital for electric vehicles, smartphones, defense technologies, and renewable energy sectors worldwide.

India and Central Asian nations are collaborating on rare earth mineral exploration to counter China’s export restrictions, which have disrupted global supply chains and impacted industries like electric vehicles. China controls about 70% of mining and 90% of processing, prompting India to seek alternative sources and stabilize trade.