Global Rare Earth: India's Strategic Push in Rare Earths: Challenging China's Dominance for Self-Reliance

The Indian government is making a strategic push into the Rare Earth Elements (REEs) sector, aiming for technological self-reliance and challenging China's long-held monopoly in the global supply chain, while a significant development is the recent removal of state-owned IREL (India) Limited from the US export control list, which opens doors for international collaboration and advanced technology access. Following this, IREL is set to establish a new facility in Visakhapatnam for the indigenous production of Samarium-Cobalt magnets, critical components for defense and high-tech equipment, while

Rare Earths: The New Oil of the 21st Century

Rare Earth Elements, a group of 17 metallic elements, are often dubbed the "new oil of the 21st century. " They're indispensable for a wide array of modern gadgets and machinery, including smartphones, electric vehicles, wind turbines, and advanced defense systems. While not inherently rare, their refining and processing are complex, costly, and environmentally challenging, making them strategically vital. A report by Kotak Mutual Fund highlights their quiet but crucial role in driving clean energy, a solid economy, and a sustainable future. Understanding their growing importance, India is now positioning itself to harness this potential.

China's Monopoly and India's Potential

Currently, China dominates the REE landscape, controlling approximately 70% of global mining. And a staggering 90% of refining, making the world heavily reliant on it for these critical resources. India possesses roughly 6% of the world's REE reserves, though its current production accounts for less than 1% globally, while however, this scenario is poised for a change. States like Kerala, Tamil Nadu, Odisha, Andhra Pradesh, and Gujarat hold substantial deposits, offering India the opportunity to emerge as a reliable alternative in the global supply chain.

Government's Decisive Steps

The Indian government has launched the ‘National Critical Mineral Mission (2025)’ to accelerate the exploration, mining, and processing of REEs. IREL's delisting from the US export control list and the. Upcoming Samarium-Cobalt magnet facility are crucial steps in this direction. Plus, India is strengthening its global footprint through KABIL (Khanij Bidesh India Limited) and participation in the US-led ‘Mineral Security Partnership’ (MSP). The International Energy Agency (IEA) projects a decrease in China's share of mining from 69% to 51% and refining from 90% to 76% by 2030, presenting a golden opportunity for India, while policy reforms like amendments to the Mines and Minerals (Development and Regulation) Act and Production Linked Incentive (PLI) schemes are encouraging private sector investment. With demand for REEs projected to surge by 300-700% by 2040, India's efforts aren't just for domestic. Needs but also to establish itself as a global leader in clean technology under the 'Make in India' initiative.