Context
China has tightened export restrictions on rare earth elements, adding five more elements to its control list.
- This move intensifies China–US trade tensions and may speed up India–US cooperation in critical mineral supply chains to reduce dependence on China
- Key Highlights
- China added five rare earth elements to its export control list effective 8 November 2025.
- US President Donald Trump threatened 100 percent tariffs on Chinese goods in response.
- India imported 2270 tonnes of rare earth elements in 2023–24, 65 percent from China.
- IREL Limited, a public sector enterprise, has a processing capacity of over 10000 tonnes per year.
Detailed Insights
- Rare earth elements include 17 metals used in electronics, renewable energy, defence technology, semiconductors and magnets.
- China controls 60 percent of global mining and 90 percent of processing of rare earths.
- India is increasing self-reliance through:
- Seabed mineral exploration
- Rare earth industrial parks
- Collaboration with Quad countries for mineral security
- The United States is reducing reliance on China by:
- Domestic mineral processing
- Recycling technologies
- Deep-sea mining research
- China’s move is seen as a strategic response before a possible Xi–Trump meeting.
- The India–US trade deal on critical minerals may gain momentum due to shared concerns over supply chain security.
Impact on India
- Import dependency on China makes India vulnerable to supply disruptions.
- Rare earths are vital for EV batteries, defence systems, satellites and electronics.
- Strategic cooperation with United States, Australia and Japan is key through the Mineral Security Partnership MSP.
Government Initiatives
- National Mineral Exploration Policy 2016
- MMDR Amendment Act 2023 allowing private sector mining of critical minerals
- Deep Ocean Mission to explore polymetallic nodules
- Critical Minerals List 2023 released by the Government of India
Challenges
- Lack of refining and separation technology in India
- Environmental issues linked to deep-sea mining
- China’s price manipulation risk
- Weak e-waste recycling capacity
Way Forward
- Forge strategic mineral partnerships with trusted countries
- Develop domestic refining and magnet production
- Establish National Critical Minerals Reserve
- Promote battery and magnet recycling