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Business Standard
13 hours ago
- Business
- Business Standard
Govt plans ₹5,000 cr boost for rare earths amid China export curbs
India is finalising a ₹3,500-5,000 crore scheme to ramp up local production of rare earth minerals and the magnets made from them, The Economic Times reported today. A senior government official was quoted as saying that the plan could get official approval within two weeks. Since April, China has limited its exports of rare earth materials. This move has caused difficulties for automakers and tech manufacturers around the world. Industries in the US, Europe, and India are facing shortages of essential magnets. Domestic firms express interest At least five major Indian companies have shown preliminary interest in producing rare earth materials, according to the government official quoted by The Economic Times. The government will offer benefits through a reverse auction process under this upcoming scheme, it is said. The proposal for these incentives came after a ministerial review suggested India needed to diversify its sourcing channels. The automobile industry in particular raised concerns about the impacts of Chinese restrictions and requested government support. Although India possesses 6.9 million metric tons of rare earth reserves, the fifth-largest globally, it lacks any domestic magnet manufacturing capacity. India relies on imported magnets, mainly from China. In the financial year 2024-25(FY25), India imported 53,748 metric tons of rare earth magnets, government data showed. China's control over global magnet supply China makes around 90 per cent of the world's permanent rare earth magnets. It has used this strong position in the ongoing trade conflict with the United States. Export controls introduced on April 4 affect not only seven specific rare earth elements but also magnets that include even small amounts of these materials. China's rare earth exports drop sharply China's exports of rare earth products dropped to a five-year low in May. Exports fell by 61 per cent compared to the same time last year — down to 2,117 tonnes, according to Bloomberg. This is the lowest since February 2020. These products, different from raw minerals and metals, are mainly in the form of magnets. Govt planning regulatory tweaks To support its critical minerals programme, the Indian government plans to amend the Mines and Minerals (Development and Regulation) Act. Alongside regulatory changes, the government expects small-scale commercial production of rare earth permanent magnets to begin later this year within India. India to stop rare earth exports to Japan India has asked state-run company Indian Rare Earths Ltd (IREL) to end a 13-year-old rare earth export deal with Japan. The government wants to ensure that local needs are prioritised. IREL also aims to improve India's capacity to process rare earth materials. Commerce Minister Piyush Goyal told IREL to halt the export of rare earths, especially neodymium, which is widely used in magnets for electric vehicle motors.
News18
3 days ago
- Business
- News18
India's Rare Earth Diplomacy: The Pull The Magnets Hold & The Contest With China
Last Updated: Rare earth magnets are used in electric vehicles, missiles, drones, and smartphones. IREL and BARC have been tasked with commercialising indigenous magnet-making technologies Amid the breaking news on Israel-Iran conflict, the instability in the Middle East and analysis of the tragic air crash in Ahmedabad, India is quietly working the diplomatic channels and other power corridors — not to procure weapons or warheads, but for rare earth magnets. Rare earth magnets are the invisible muscle behind electric vehicles, missiles, drones, and smartphones. India's rare earth diplomacy is no longer buried in the footnotes of strategic policy memos. It is now to the fore of the silent, but systematic high-stakes geopolitical battle. With Beijing controlling over 90% of the global supply chain for rare earth elements, especially neodymium and dysprosium magnets, the urgency is now palpable. For India, this isn't just about market dominance or self-reliance, but about national security and 'technological sovereignty", an expression that PM Modi used in his crucial meeting with the top bureaucrats last month. INTER-MINISTERIAL MEETINGS AND OUTREACH An inter-ministerial meeting, co-chaired by the union minister for steel and heavy industries, H.D. Kumaraswamy, and union minister for mines and coal, G Kishan Reddy, brought together heavyweights from the ministries of Heavy Industries, Steel, Mines, Commerce & Industry, and the Department of Atomic Energy. The officers, informed of the developments, said that this meeting is one of the series of developments happening over the rare earth-related deliberations and decisions. The agenda was to break the Chinese monopoly on rare earth magnets and fast-track India's indigenous capabilities. 'This inter-ministerial effort will pave the way for India's self-reliance in strategic materials crucial for EVs, electronics, defence and other sectors," Kumaraswamy said in a statement after the meeting. At the centre of India's response are two little-known but powerful institutions—Indian Rare Earths Limited (IREL) and BARC. The plan is to not just mine the elements, but to crack the far more complex challenge of processing and commercialising high-grade rare earth magnets domestically — a stage where most countries drop out, and China dominates. HOW DID CHINA FLEX ITS MUSCLES OVER MAGNETS? In April, China flexed its control over the global rare earth supply chain by further tightening export controls on select items. The move sent shockwaves through global manufacturing sectors and particularly rattled India's auto and electronics industries that are increasingly reliant on rare earth magnets for everything from EV motors to missile systems. However, New Delhi appears to be responding with calculation. The Ministry of External Affairs (MEA) has stepped into what is traditionally a trade and industry domain. It is now engaging Chinese counterparts in both Delhi and Beijing, pushing for more transparency, consistency, and predictability in rare earth exports. The MEA's approach is measured and precise. Meanwhile, the ministry also quietly swung into action, opening fresh diplomatic channels with countries in Europe, Australia and Central Asia—the regions rich in rare earth reserves and wary of Chinese overreach. These aren't headline-grabbing bilateral summits, but slow, deliberate and calculated moves through joint ventures, technology transfers, exploratory talks, and all with one aim of diversifying supply and building parallel trust chains. India's search for new friends is as much about geopolitical strategy and also about geochemistry. The push aligns with PM Modi's vision of Atmanirbhar (self-reliant) Bharat and Viksit Bharat 2047, said a senior IAS officer, who is part of the rare earth deliberation. India is not just trying to weather the storm. It is now trying to build its own ark. IREL and BARC, the country's rare earth processing and atomic research backbones, are now tasked with commercialising indigenous magnet-making technologies. Get breaking news, in-depth analysis, and expert perspectives on everything from politics to crime and society. Stay informed with the latest India news only on News18. Download the News18 App to stay updated! tags : 360 degree view Narendra Modi news18 specials rare earth elements Location : New Delhi, India, India First Published: June 18, 2025, 13:01 IST News india India's Rare Earth Diplomacy: The Pull The Magnets Hold & The Contest With China
Mint
4 days ago
- Business
- Mint
India's leading rare earths producer IREL has no full-time chairperson during supply crisis
Mumbai: IREL (India) Ltd, a public sector enterprise that produces rare earth elements, does not have a full-time chairperson and managing director (CMD) since December 2024 when Deependra Singh vacated the post after nearly a decade at the helm. The vacancy comes to light at a time when Indian manufacturers, especially makers of automobiles, fear production disruptions due to China restricting the export of rare earth elements. The Indian government and industry are exploring alternatives to reduce reliance on China for these elements that go into several electronic components, particularly motors that drive electric vehicles. Currently, the position of CMD is shown as vacant on the website of IREL. S.B. Mohanty, the company's director of finance, has taken the interim charge of the CMD office. Also read: Mint Long Story: India's EV dreams caught between rare earth and a hard place The Miniratna firm had put out an advertisement inviting applications for the CMD position in February. 'Indian public sector enterprises are tardy when it comes to filling director and KMP (key managerial personnel) roles as they wait for approval from their parent ministries," said Shriram Subramanian, a corporate governance export and the managing director of proxy advisory firm InGovern. 'This needs to be resolved by a directive from the Prime Minister's Office to all ministries as it sends a wrong signal that the PSEs (public sector enterprises) don't have planned succession planning and is a disservice to the companies and their investors," he said. Emails and calls to IREL requesting comment did not elicit a response. The longstanding vacancy of the top position at IREL is another indication of India perhaps missing a trick by not capitalizing on its early lead in this sector. In 2010, India had little over 2% share of global output of rare earths, second only to China's overwhelming 95% share. But uncompetitive costs of Indian producers in the face of the Chinese juggernaut smothered the fledgling domestic rare earths industry. IREL had a Rare Earths Division at Aluva in Kerala which it had to shut in 2004 due to the lack of market competitiveness. 'Despite the importance of rare earths in meeting the zero emission target by 2070 and IREL's capability in making refined individual rare earths available for the downstream industry, the rare earth ecosystem is yet to take off in India," IREL said in its FY24 annual report, adding that the domestic market for its products was nearly non-existent. Also read: Top power authority mulls sops for critical components as China curbs rare earth supply A slower-than-expected adoption of electric vehicles globally has led to rare earths supply outstripping demand, the firm said in the annual report. This eroded the prices of rare earths. 'Despite this adverse situation, IREL has successfully made available rare earth products with quality and price on par with the leading supplying country," the company said. Originally called Indian Rare Earths Ltd, the firm was set up in 1950 under the administration of independent India's first prime minister Jawaharlal Nehru to produce thorium to support India's nuclear power needs. Over the years, the firm diversified to produce other rare earth elements, including a recently inaugurated rare earth magnet plant at Vishakhapatnam. The company had warned as early as 2010 that China's consolidation of the global rare earths supply chain could be an issue in the future for industries like smartphones, solar cells and new technology vehicles. This was after China paused supplies of rare earths to Japan following a disagreement over oceanic boundaries, prompting the island nation to strike a deal with IREL for the rare earths, Mint reported in November 2010. Also read: Automakers urge Indian govt for diplomatic outreach to China for rare earths That agreement is still in force. Last week, the Indian government asked IREL to suspend the 13-year-old agreement with Japan and to safeguard supplies for domestic needs, Reuters reported, citing two unnamed sources. The company reported a profit of ₹1,012 crore for FY24. Its revenue for the year was ₹2,104 crore.
Yahoo
4 days ago
- Business
- Yahoo
India to conserve rare earths for domestic use, halt Japan exports
India has reportedly requested state-owned miner IREL to suspend rare earth exports to Japan, a move that could affect a 13-year-old supply agreement, reported Reuters, citing sources. The decision aims to meet domestic needs and reduce reliance on China for these critical materials. This strategic shift comes as China has limited its rare earth exports, which are essential for high-tech industries including electric vehicle (EV) manufacturing. India, which has the world's fifth-largest rare earth reserves but lacks domestic magnet production, imported 53,748 tonnes (t) of rare earth magnets in the fiscal year to March 2025, mainly from China. In a recent meeting, Indian Commerce Minister Piyush Goyal directed IREL to halt the export of rare earths, particularly neodymium, a crucial element for producing magnets used in EV motors. The Commerce Ministry, IREL, and the Department of Atomic Energy, which oversees IREL, have yet to comment on the matter, the report said. Under the 2012 agreement, IREL supplies rare earths to Toyotsu Rare Earths India, a subsidiary of Toyota Tsusho, for processing and subsequent export to Japan. In 2024, Toyotsu shipped more than 1,000t of rare earth materials to Japan, a significant portion of the 2,900t mined by IREL. Despite this, China remains Japan's primary source for rare earths. With China's recent export restrictions causing global supply chain concerns, IREL is looking to retain its rare earths for domestic expansion in mining and processing. The company is currently awaiting statutory clearances to proceed with four mines. However, an immediate halt to exports to Japan may not be feasible due to the bilateral nature of the existing agreement. Japan's Trade Ministry has refrained from commenting on specific bilateral exchanges. India's move to conserve its rare earths aligns with the recently launched National Critical Mineral Mission (NCMM), which seeks to ensure self-reliance in critical minerals essential for clean energy technologies. The NCMM supports India's climate goals including reducing emissions intensity and achieving net-zero emissions by 2070. The strategy includes securing critical mineral supply chains through domestic exploration and overseas asset acquisition. "India to conserve rare earths for domestic use, halt Japan exports" was originally created and published by Mining Technology, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
Deccan Herald
5 days ago
- Automotive
- Deccan Herald
India moves to conserve its rare earths, seeks halt to Japan exports, sources say
In a recent meeting with auto and other industry executives, Indian Commerce Minister Piyush Goyal asked IREL to stop its exports of rare earths, mainly neodymium, a key material used in magnets for electric vehicle motors, one of the sources said.
