Key Points

"We are in touch with the Chinese side, both here in Delhi as also in Beijing to bring predictability in supply chain for trade, consistent with international practices," Ministry of External Affairs Spokesperson Randhir Jaiswal told reporters in the weekly briefing.

The MEA spokesperson was asked about India's engagement with China on rare earth, given that it is to an extent impacting the auto industry, among others in India.

"We have been in touch with the Chinese side. The Chinese ministry of commerce and general administration of customs in early April...had announced a decision to implement export controls on certain rare earth related items," the MEA spokesperson said.

Amidst this key supply chain issue, US President Donald Trump on Wednesday confirmed that the US reached a "deal" with China following intense trade negotiations. As part of the deal, the US, according to Trump, will get rare earth supplies from China.

Commerce and Industry Minister Piyush Goyal described China's rare earth export restrictions as a global "wake-up call" on Monday, emphasising that India is actively building alternative supply chains while positioning itself as a trusted partner for international businesses seeking to reduce their dependence on Chinese suppliers.

Speaking to reporters during his official visit to Switzerland, where he met with Swiss government officials and business leaders, Goyal acknowledged that China's export curbs will create short-term challenges for India's automotive and white goods sectors.

However, he expressed confidence that collaborative efforts between government, industry, and innovators will transform these challenges into long-term opportunities.

China's overwhelming control of global rare earth processing - commanding over 90 per cent of the world's magnet production capacity - has created significant vulnerabilities for industries worldwide. These materials are critical across multiple sectors, including automobiles, home appliances, and clean energy systems.

Beyond China, there are only a few alternative suppliers.

The new Chinese restrictions, effective from April 4, require special export licenses for certain specific rare earth elements and their related magnetic products.

Separately, India and Central Asian countries have recently expressed interest in joint exploration of rare earth and critical minerals at the recently held India-Central Asia Dialogue.

The renewed expression of interest in collaboration in rare earths and critical minerals comes as China has restricted its exports of some key industrial inputs.

According to a joint statement by India and Central Asian countries -- Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and, Uzbekistan -they appreciated the outcomes of the first India-Central Asia Rare Earth Forum held in September 2024 in New Delhi, as they called upon the relevant authorities to hold the second India-Central Asia Rare Earth Forum meeting at the earliest convenience.

- ANI