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Rare earths magnets: How realistic are India's its ambitions? - BBC

Lau Chi Fung

— 3 min read

India Takes Steps to Reduce Dependence on China for Rare Earth Magnets

The Indian government has taken a significant step towards reducing its dependence on China, a country notorious for its dominance in the global rare earth magnet market. In November 2025, India approved a $800 million plan aimed at developing its own domestic production of rare earth magnets.

The Importance of Rare Earth Magnets

Rare earth magnets are a crucial component in various industries, including:

  • Electric vehicles: Rare earth magnets are used in the motors and generators of electric vehicles.
  • Electronics: They are used in the production of electronic devices such as smartphones, laptops, and televisions.
  • Aerospace: Rare earth magnets are used in the production of aircraft and spacecraft components.

China is currently the largest producer of rare earth magnets, accounting for over 90% of global production. This has created concerns among countries that rely heavily on China for their rare earth magnet needs.

India's Plan to Reduce Dependence

India's plan to develop its own domestic production of rare earth magnets is a significant step towards reducing its dependence on China. The plan, which was approved by the Indian government in November 2025, includes:

  • Investment in research and development: The Indian government plans to invest heavily in research and development to improve the efficiency and productivity of rare earth magnet production.
  • Development of new technologies: India plans to develop new technologies that can reduce the cost of producing rare earth magnets.
  • Establishment of new manufacturing facilities: The Indian government plans to establish new manufacturing facilities to produce rare earth magnets.

Benefits for India

India's plan to develop its own domestic production of rare earth magnets is expected to have several benefits, including:

  • Reduced dependence on China: By reducing its dependence on China, India can reduce the risks associated with supply chain disruptions.
  • Increased economic growth: The development of a domestic rare earth magnet industry is expected to create new job opportunities and stimulate economic growth.
  • Improved national security: Reducing dependence on foreign countries for critical components like rare earth magnets can improve national security.

Challenges Ahead

While India's plan to develop its own domestic production of rare earth magnets is a significant step forward, there are several challenges ahead. These include:

  • High upfront costs: Developing a new industry requires significant investment in research and development, manufacturing facilities, and personnel.
  • Competition from established producers: The global rare earth magnet market is dominated by established producers such as China and the United States.
  • Regulatory framework: India needs to develop a regulatory framework that can support the growth of its domestic rare earth magnet industry.

Conclusion

India's plan to develop its own domestic production of rare earth magnets is an ambitious step towards reducing its dependence on China. While there are several challenges ahead, the potential benefits for India and other countries that rely heavily on China for their rare earth magnet needs are significant. As the global demand for rare earth magnets continues to grow, it will be interesting to see how India's plan unfolds.

Timeline of Major Events

  • November 2025: India approves a $800 million plan to develop its own domestic production of rare earth magnets.
  • 2026-2030: Research and development efforts are expected to commence, with the aim of improving the efficiency and productivity of rare earth magnet production.
  • 2030-2040: Manufacturing facilities are expected to be established, with the first batch of domestic rare earth magnets being produced.

Future Outlook

The future outlook for India's domestic rare earth magnet industry is promising. With continued investment in research and development, improved manufacturing efficiency, and a competitive regulatory framework, India is well-positioned to become a major player in the global rare earth magnet market. As the demand for rare earth magnets continues to grow, it will be interesting to see how India's plan unfolds and whether it can reduce its dependence on China.

Conclusion

India's plan to develop its own domestic production of rare earth magnets is an ambitious step towards reducing its dependence on China. While there are several challenges ahead, the potential benefits for India and other countries that rely heavily on China for their rare earth magnet needs are significant. As the global demand for rare earth magnets continues to grow, it will be interesting to see how India's plan unfolds.

References

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