NEW DELHI: 18th June 2025
India is looking to counter the risks associated with the Chinese supply chain by implementing a rare earth strategy more quickly. To make it happen, the Indian government established a Critical Minerals Panel in the midst of EV and other industries that require access to these magnets, such as electronics and defence. The government's top priority is derisking from China.
The interministerial coordination committee will keep an eye on rare earth supply chains, identify substitutes, and promote domestic manufacturing of rare earth permanent magnets (REPMs), which are essential parts of defence systems, smartphones, electric cars, and renewable energy.
The panel, which consists of the Department of Atomic Energy, the Ministries of Commerce, Steel, Coal, Mines, and Heavy Industries, has been given two years to produce results. According to Heavy Industries Minister H.D. Kumaraswamy, "this effort will pave the way for India's self-reliance in strategic materials."
Beijing has increased export restrictions on a number of rare earth elements, such as terbium and dysprosium, since April as part of a larger plan to control next-generation technology supply chains.
With the auto industry alone using almost 870 tonnes of rare earth magnets annually out of 3,600 tonnes imported, India's rare earth imports are small in volume but strategically significant.
In a post on X, Mines and Coal Minister G. Kishan Reddy stated that the government is taking a whole-of-government approach to make India Atmanirbhar in minerals. He also mentioned that the new task force will focus on developing domestic capabilities "from mining to refining to end-use."
According to officials, if alternate supplies are not found, India's rare earth magnet supplies may run out by the end of the month. Major OEMs such as Brakes India, Continental, Minda Instruments, Sona Comstar, Uno Minda, and Varroc are supplied by more than 35 Indian companies that import these magnets from China.
There is more at stake than just business. Because they are utilised in satellites, missile systems, and sophisticated electronics, rare earth elements are essential to national security. Following China's increasing trade tensions with the West and its use of mineral restrictions to exert pressure on nations over diplomatic issues, such as Taiwan and the South China Sea, there is a renewed concern about mineral security on a global scale.
In a post on X, Heavy Industries Minister H.D. Kumaraswamy stated, "This action will open the path for India to become self-sufficient in strategic materials."
At the core of India's push for EVs and electronics are rare earth magnets, which are necessary for electric motors and braking systems. About 870 tonnes of India's 3,600 tonnes of annual imports of REPM (Rare Earth Permanent Magnet) come from the automobile industry alone. Government officials warned that stock prices could run out as early as next month
The rare earth shortage for India highlights long-standing weaknesses in industrial policy. Even though India has large reserves of rare earths, particularly in coastal and monazite-rich areas, a significant portion of this potential remains unrealised due to regulatory barriers, inadequate infrastructure for refining, and a shortage of capacity for producing high-end magnets.
The initiative is currently in line with India's National Critical Minerals Mission (NCMM), which places a high priority on strategic stockpiling and domestic exploration of important minerals like lithium, cobalt, and rare earths. In order to close technological gaps and increase domestic production, senior officials, such as DAE Secretary Dr. Ajit Kumar Mohanty and Heavy Industries Secretary Kamran Rizvi, have also started consulting with industry.
According to an official participating in the talks, "the policy thrust is not just about supply security but also about creating a complete domestic ecosystem." To assist India in establishing a comprehensive rare earth-to-magnet supply chain from the ground up, industry leaders have requested specific incentives, streamlined mining clearances, and increased research investments.
India’s challenge now is to compress a decade-long industrial buildout into a two- to three-year window — with geopolitical pressure mounting, the clock has started ticking.
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