The Ministry of External Affairs (MEA) has confirmed that India is actively communicating with China to address supply chain disruptions related to rare earth materials. During a recent weekly briefing, MEA spokesperson Jaiswal stated that discussions are ongoing with Chinese counterparts in both Delhi and Beijing to streamline the supply chain. The MEA is also in touch with China on a range of economic and trade matters. Concurrently, the Commerce Secretary highlighted India’s commercial and diplomatic efforts to secure essential imports of rare earth minerals from China. The government is coordinating with industry organizations like SIAM and ACMA to facilitate discussions between them and their Chinese counterparts. China’s restrictions on rare earth exports are seen as a global issue, not solely targeting India. India’s Commerce and Industry Minister has called the situation a ‘wake-up call’, emphasizing India’s focus on developing alternative supply chains and establishing itself as a reliable partner for international businesses seeking to diversify from Chinese suppliers. China dominates global rare earth processing, controlling over 90% of the world’s magnet production capacity, creating vulnerabilities for industries across automobiles, home appliances, and clean energy. New Chinese restrictions, effective from April 4, require special export licenses for specific rare earth elements and magnetic products. India and Central Asian countries are exploring joint ventures in rare earth and critical minerals, as discussed at the India-Central Asia Dialogue. According to a report by Crisil Ratings, China’s export restrictions may pose supply-side risks to India’s automotive sector.
