Big relief on rare earth imports…
After a six-month pause, China has finally resumed the supply of heavy rare earth magnets to India. These powerful magnets are used in industries like electric vehicles, renewable energy plants and consumer electronics. The commencement of supply has brought great relief to Indian companies, because without these magnets many production plans had come to a halt.
China controls about 90% of this market worldwide, so any restriction affects the entire industry. Now that Beijing has opened the doors again, it is expected that India’s EV and tech sector will gain momentum again.
China set strict conditions
According to an ET report, however, this relief has not come without conditions. China has clearly said that these rare earth magnets received by India cannot be re-exported to America. Also, they should not be used for any military or defense purpose. Beijing has sought a guarantee from India that this material will be used only for domestic needs.
The reason behind this step is the ongoing trade tension between China and America. In the recent meeting between US President Donald Trump and Chinese President Xi Jinping, both the countries agreed to make efforts to reduce tensions, but control on strategic items continues at present.
Four Indian companies got green signal
So far in India, four companies Hitachi, Continental, J-Ushin and DE Diamonds have got permission to import from China. These companies have taken all the necessary approvals from Chinese exporters and Indian authorities.
Expectations have increased in the industry after indications of resumption of supplies. Along with this, direct flights between India and China between Kolkata and Guangzhou have also started again, which is expected to further intensify business activities.
China asked for guarantee of use
China has asked for an End-User Certificate (EUC) from every buyer. It is important to write in this document that the purchased material will not be used in making any kind of weapon or device of mass destruction. Indian companies had already submitted these certificates, but more than 50 applications were waiting for approval in China’s Commerce Ministry. Now some of these have got the green signal, due to which the supply line has started again.
Why are these rare earth magnets important?
These extremely powerful magnets are considered the backbone of modern technology. They are used everywhere, from electric vehicle motors to wind turbines, mobile phones, laptops and aerospace equipment. In India, especially the EV sector is the largest consumer of these magnets. In FY 2025, India had imported about 870 tonnes of rare earth magnets, the total value of which was about ₹ 306 crore.