India asked state owned miner, IREL, formerly Indian Rare Earth Limited, to suspend a 13 year-old rare earth export agreement with Japan. According to the official report by Reuters, it is happening to secure domestic supply and reduce dependency on China. The decision was taken for growing global concerns over China’s strong grip on rare earth exports which are difficult for advanced industries and electric vehicles.
IREL also has a goal to expand India’s domestic processing potential for rare earth, which is recently controlled by China, and has become a powerful weapon at a time of rising trade wars
China has restrained its rare earth material exports since April , forcing automakers and high-tech manufacturers worldwide.
Also Read: World Bank Projected India’s Growth Rate at 6.3% for FY26
Indian Commerce Minister Piyush Goel asked IREL to suspend the rare earth material called Neolodiyan, which is a key component used in vehicle motors in a recent meeting.
Toyotsu shipped over 1,000 metric tonnes of rare earths to Japan, according to the report. This accounted for roughly one-third of IREL’s total rare earth production of 2,900 tonnes, it said. While Japan still depends heavily on China for its rare earth needs, the Indian supply has been a strategic alternative.
