Why is it in News?
- Union Cabinet approved a ₹7,280-crore scheme to establish integrated REPM manufacturing facilities in India.
- Aim: Convert rare earth oxides → metals → alloys → permanent magnets, reducing import dependence.
- Announcement comes as China tightens export controls on rare earth elements (REEs) and magnets, disrupting global supply chains.
Relevance
GS 1 – Geography
- Mineral distribution in India (monazite sands: TN, Kerala, Odisha).
- Resource geography and strategic minerals.
GS 2 – International Relations
- Strategic minerals in geopolitics (US–China tech war).
- Global supply chain dependencies.
- Critical minerals alliances with Japan, US, EU.
GS 3 – Science & Tech
- Metallurgy, magnet technology, refining and separation tech.
- REPM (NdFeB) magnet ecosystem.
What are Rare Earth Elements (REEs)?
- Group of 17 elements: 15 lanthanides + Scandium + Yttrium.
- Properties: High magnetic strength, heat resistance, conductivity.
- Applications:
- EV motors
- Wind turbine generators
- Electronics and semiconductors
- Defence systems (missiles, radars, avionics)
- Smartphones, hard drives
- REEs are relatively abundant, but extraction is costly, energy-intensive, and polluting.
China’s Dominance: Extent and Strategy
- 70% of global production, 90% of global processing, but only 30% of known reserves.
- Controls entire value chain: mining → processing → magnet manufacturing.
- Tools of dominance:
- 2009: Export quotas → struck down by WTO in 2015.
- 2020: Restricted graphite exports.
- 2021: Export licensing to control downstream industries.
- 2024-25: Export restrictions on 7 rare earths and finished magnets.
- Impact on industries:
- EV makers worst affected, followed by electronics & defence.
- Part of broader US–China trade and tech war.
Why India is Prioritising REEs?
- REEs are critical for:
- Electric mobility (EV motors = NdFeB magnets)
- Renewables (wind turbines)
- Electronics manufacturing
- Defence and space systems
- India’s situation:
- Imports 53,000+ MT of REE magnets (FY 2024-25).
- Holds ~8% of global REE reserves, mainly monazite sands (TN, Kerala, Odisha, Andhra).
- Produces less than 1% of global REEs.
Government Moves Toward Self-Reliance
New ₹7,280-crore REPM scheme
- Supports end-to-end magnet manufacturing.
- Aim: Create India’s first complete rare-earth magnet supply chain.
National Critical Mineral Mission (2024–2031)
- Total outlay: ₹34,300 crore (₹16,300 crore approved Jan 2024).
- Focus areas:
- Exploration
- Processing
- Refining
- Recycling (end-of-life electronics)
Mining reforms
- Private sector allowed entry since August 2023.
- Auctions of REE-rich blocks in progress.
Structural Challenges for India
- Refining and separation infrastructure absent (core of China’s strength).
- Skill gaps in metallurgy, material sciences, precision magnet making.
- Regulatory hurdles: environmental approvals, slow exploration licensing.
- Long gestation period: 5–8 years for full supply chain maturation.
Opportunities India Can Leverage
- Large monazite deposits rich in Neodymium (Nd) → essential for permanent magnets.
- Growing ecosystem of magnet recycling from e-waste.
- Global diversification push away from China → aligns with India’s manufacturing ambitions.
- Strategic potential:
- Reduce dependence in EVs, defence, electronics.
- Build partnerships with Japan, US, EU (who are all seeking non-China REE suppliers).
Strategic Significance
- Economic dimension
- Reduces import bill for magnets & REEs.
- Boosts Make in India for EVs, electronics, renewables.
- High-value segment: REPMs (NdFeB magnets) are 10x more valuable than raw REE oxides.
- Geopolitical dimension
- Counters China’s resource weaponisation tactics.
- Strengthens India’s role in global critical minerals alliances (Indo-Pacific partnerships).
- Security dimension
- Defence systems—from missile guidance to electronic warfare—depend on REPMs.
- Reducing vulnerability enhances strategic autonomy.
- Environmental dimension
- Domestic production necessitates safe mining + environmentally sound refining.
- Recycling can reduce pollution and import dependence simultaneously.
Conclusion
- REEs are indispensable for modern technology; China dominates supply chains.
- India has reserves but lacks extraction–processing–magnet manufacturing capacities.
- The ₹7,280-cr scheme + National Critical Minerals Mission aim to build self-reliance.
- Success depends on deregulation, infrastructure, skilled workforce, and global collaboration.
