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Approach:

  1. Introduction on rare earth elements.
  2. Briefly mention their characteristics.
  3. Mention the strategic significance of RREs.
  4. Mention about limitations in India’s production.
  5. Conclusion

Rare earth elements (REEs) are a group of 17 chemically similar metallic elements in the periodic table. The rare earths are actually not ‘rare’ in nature; they occur abundantly but are often not concentrated enough for viable extraction.

Characteristics: REEs are characterized by high density, high melting point, high conductivity, and high thermal conductance. REEs are classified into Heavy REE and Light REE. REEs do not occur in a free state. They are found in mineral oxide ores. Some of the principal sources of rare earth elements are bastnaesite, xenotime, loparite and monazite.

Strategic significance of REEs:

  • They are used in various hi-tech applications & processes like EVs, Medicinal appliances, LEDs, healthcare, clean energies, aerospace, defence, etc.
  • Their multifarious uses in new age technologies cause rise in future demand. For e.g., the current demand of  neodymium in India is small, at around 900 tonnes per annum, because domestic manufacturing of EVs and wind turbines is still limited. However, as manufacturing of EVs and wind turbines picks up, the demand for neodymium is estimated to rise sharply by 6-7 times by 2025.
  • India is almost 100% import dependent for most rare earths. Further, prices of rare elements are consistently rising due to the rising demand.
  • The global supply chain is highly concentrated, posing a strategic challenge. China had controlled 90% of the supply of rare earths. Now, after aggressive production by the US, Australia and Canada, China’s share is down to 60%. Following dispute over the Senkaku Islands, China stopped exports of RREs to Japan. Given India’s border dispute, China might resort to similar tactics in future.
  • India has greater reserves than the US and Australia, only behind China, Vietnam, Russia, and Brazil. With Russia embroiled in conflict, India can potentially emerge as a supplier not just for domestic use but also for international consumption.

India’s limited production of RREs:

  • RE materials are not concentrated enough in geographical locations for commercially viable exploitation.
  • Presently, they are classified as atomic minerals, whose mining is reserved exclusively for government companies. Currently, there are only two companies – Indian Rare Earths Ltd (IREL) and Kerala Minerals and Metals Ltd that can mine them. Further, their production capacities and technological capabilities are limited.
  • Extraction companies have poor incentives to refocus as a globally competitive rare earth extraction and processing firms. This has restricted India to be a low-cost exporter of rare earth oxides instead of higher value-added products.
  • The present system results in separating the rare earths ecosystem from other R&D ecosystemslike electronics or metallurgy. This severely impacts the overall umbrella of strategic research, undercutting the interdisciplinary nature of modern research work. The situation is similarly disintegrated with regards to exploration.
  • Beach sand miningwas permitted until a few years ago but was banned in 2016 to conserve strategic minerals including rare earths and thorium.

The time is right to focus on boosting the indigenous supply of rare earth metals, contributing a total value of nearly US$ 200 billion to the Indian economy. A sustained supply is also essential to reduce its dependence on Chinese imports and truly realize the vision of Aatmanirbhar Bharat.

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