India in touch with China over rare earth supply chain issues: MEA

India is actively engaging with China on various economic and trade matters, including concerns over the supply chain of rare earth materials, the Ministry of External Affairs (MEA) said on Thursday.

Addressing a weekly press briefing, MEA spokesperson Randhir Jaiswal stated, "On trade issues related to rare earths, we have been in contact with the Chinese side both in Delhi and Beijing. Discussions are ongoing to streamline the supply chain for these critical materials." He added that India remains in regular communication with China on a broad range of economic and trade concerns as needed.

Echoing this stance, Commerce Secretary Sunil Barthwal earlier this week confirmed that India is pursuing both commercial and diplomatic channels with China to ensure a stable supply of rare earth minerals. “We’re also working closely with industry bodies like SIAM (Society of Indian Automobile Manufacturers) and ACMA (Automotive Component Manufacturers Association), helping them engage directly with Chinese counterparts,” Barthwal said.

He further emphasized that China’s recent export restrictions on rare earths are part of a broader global policy move and not specifically targeted at India. 
China, which currently controls over 90% of the world’s rare earth magnet production capacity, introduced new export regulations effective April 4. These require special licenses for certain rare earth elements and related magnetic products raising concerns across global industries dependent on these materials.

India's Commerce and Industry Minister Piyush Goyal recently called China's export controls a global “wake-up call.” He highlighted India's efforts to develop alternative rare earth supply chains and position itself as a reliable partner for countries and companies seeking to reduce their dependency on Chinese resources.

India is also exploring international collaborations to secure its rare earth needs. At the recent India-Central Asia Dialogue, countries including Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan expressed interest in jointly exploring rare earth and other critical minerals.

The stakes are particularly high for India's automotive sector. Rare earth magnets though low in cost are vital components in electric vehicles (EVs) and hybrid systems, especially in permanent magnet synchronous motors (PMSMs) due to their high efficiency and compact size.

A recent report by Crisil Ratings warned that a disruption in rare earth supply lasting more than a month could hamper upcoming EV launches, disrupt production, and slow the sector’s growth. The report underlined the need for a diversified and resilient supply chain to support India's transition to clean mobility and energy systems.