Our Bureau
New Delhi
India is launching a National Critical Mineral Stockpile program to build a two-month stockpile of rare earth elements amid China’s tight restrictions on rare earth magnet exports, critical for electric vehicles, wind turbines, and high-tech industries. The government aims to ease supply chain disruptions and enhance domestic manufacturing of rare earth magnets through private sector involvement under this initiative.
The stockpile initiative is part of a broader strategy to reduce India’s heavy dependence on China, which controls over 90% of global rare earth magnet processing capacity. To stimulate local production, India approved a Rs 7,300 crore incentive program targeting production of 6,000 tonnes of rare earth magnets over the next five years, complemented by a Rs 500 crore allocation under a National Critical Minerals Mission to secure mineral availability.
India possesses significant rare earth reserves across multiple states but currently relies mostly on imports due to limited processing capabilities. The government recently auctioned multiple critical mineral blocks to boost domestic extraction. Meanwhile, diplomatic and industrial efforts are ongoing to diversify supply chains and mitigate short-term challenges faced by sectors like automotive and electronics, heavily impacted by China’s export controls.
Commerce Minister Piyush Goyal called China’s export restrictions a global wake-up call, emphasizing India’s commitment to become a trusted manufacturing partner with robust alternative rare earth supply chains. The stockpiling move aims to protect strategic industries from future disruptions caused by geopolitical tensions and global supply chain vulnerabilities.
India’s strategy includes integrating stockpiling with production-linked incentives to make domestic magnet production competitive against subsidized Chinese imports. The long-term vision is a fully integrated rare earth value chain encompassing mining, processing, and magnet manufacturing to achieve self-reliance and global competitiveness.
