India’s Rare Earth Magnet Crisis: 95% China Import Surge Sparks Defence & EV Supply Chain Alarm

Import Crisis in Numbers
FY25 Imports: 53,700 tonnes (↑95% YoY)
China’s Share: 93% (50,000 tonnes)
Critical Shortage: Just 2-3 weeks of NdFeB magnets (vital for EV motors) remain

Why Rare Earths Matter
Applications: Permanent magnets power EVs, wind turbines, missiles, drones.
China’s Dominance: Controls 70% global rare earth production, 90% processing.
India’s Paradox:
Reserves: 6.9M tonnes (3rd largest globally)
Production: Only 2,900 tonnes (7th rank)

Geopolitical Triggers
China’s Export Curbs: Response to US tariffs; requires Indian importers to sign “non-military use” undertakings.
Global Fallout: Disrupts supply chains; highlights critical minerals as economic weapons.

India’s Strategic Gaps
Processing Deficit:
IREL (India) Ltd refines oxides but lacks tech to convert them into magnets.
Resource Mobilization:
Exploring ores from Sri Lanka/Myanmar; countered by China’s price manipulation.
Policy Lag:
No integrated critical minerals strategy despite 2023 list identifying 30 minerals.

Roadmap for Self-Reliance
Short Term: Stockpiling, diversifying imports (Vietnam, Australia).
Medium Term:
Tech Partnerships: Joint ventures for magnet processing.
PLI Schemes: Incentivize domestic REE production.
Long Term:
Exploration: Untapped reserves in Odisha, Andhra.
Recycling: Recover REEs from e-waste.
 
Sample Q&A for Mains
Q: How do rare earth magnets impact India’s strategic sectors?
A: Essential for precision-guided missiles (defence), EV motors (clean energy), and wind turbines – sectors prioritized in Make in India.
Q: Differentiate ‘critical minerals’ from ‘rare earth elements’.
A: Critical minerals (e.g., lithium, cobalt) are vital for economic security with supply risks; REEs (e.g., neodymium) are a specialized subset used in high-tech applications.
Q: Why does India rank 3rd in REE reserves but 7th in production?
A: Limited mining leases, environmental clearances delays, and lack of processing tech deter commercial exploitation.
Q: How do China’s export curbs affect India’s federal resource planning?
A: Forces states to expedite mining approvals (e.g., Odisha’s REE projects) and integrate mineral security into industrial policies.
Q: Suggest measures to reduce REE import dependency.
A:
Establish National Rare Earths Mission
Invest in hydrometallurgical processing tech
Join US-led Mineral Security Partnership