In a significant move aimed at protecting national interests and boosting self-reliance, India has asked its state-run mining company IREL (India Rare Earths Limited) to pause rare earth mineral exports to Japan. This decision comes after 13 years of consistent supply under a bilateral agreement with the Japanese firm Toyotsu Rare Earths India, a subsidiary of Toyota Tsusho.
The rare earth materials—especially neodymium, which is crucial for making magnets used in electric vehicle motors—have been mostly exported due to India’s limited processing infrastructure. But with China tightening its own rare earth exports and dominating the global supply chain, India is now rethinking its priorities.
According to sources, the Indian government wants IREL to expand domestic mining and processing so that the country is no longer dependent on imports for high-tech components like magnets, used across industries including automotive and pharmaceuticals.
Commerce Minister Piyush Goyal recently met with auto and industry leaders to emphasize this shift. Although India may not be able to halt supplies to Japan overnight due to the standing agreement, IREL is reportedly looking to resolve the issue diplomatically, recognizing Japan as a key partner.
Currently, Japan still heavily depends on China for rare earths, but the move from India sends a clear message: it’s time to build at home and ensure future resilience.
India holds the fifth-largest reserves of rare earths in the world, yet it does not produce magnets domestically—a gap the government now aims to bridge.
FAQs:
Q1: Why is India stopping rare earth exports to Japan?
India wants to keep more of its rare earth minerals, especially neodymium, for domestic use to reduce reliance on imports and prepare for potential global supply disruptions caused by China’s export limits.
Q2: Will this impact India-Japan relations?
India and Japan share strong ties, and officials hope to resolve this issue amicably. The current exports are part of a formal government-to-government agreement, so any changes will likely be negotiated with care.
