Why did China block exports of rare earth elements? Pg8

– China imposed export restrictions on 17 rare earth elements (REEs) amid the ongoing U.S.-China trade war.

– India imports a limited quantity of REEs; most are refined in China.

– Restrictions could disrupt global supply chains of critical raw materials.

– India is pursuing self-reliance via the National Critical Mineral Mission (NCMM).

– 2,270 tonnes of REEs were imported into India in 2023-24.

Background/Context

• Rare Earth Elements (REEs) are 17 chemically similar elements crucial for manufacturing in semiconductors, defence, electronics, nuclear shielding, and renewable tech.

• Despite being abundant in nature, REEs are difficult to isolate, requiring sophisticated refining processes.

Key Developments

• China’s export curbs affect 7 of the 17 REEs, including dysprosium, gadolinium, lutetium, samarium, and others.

• These are essential for devices like PET scanners, hard disks, electric vehicles, aircraft, and superconductor tech.

• China's curbs apply to refiners exporting REEs and may not constitute an outright ban but still threaten short-term supply disruptions.

• India imported 2,270 tonnes of REEs in 2023-24 and depends on both domestic production and imports.

Strategic/Policy/Legal/Economic Implications

• India’s REE refining capacity is limited, making it vulnerable to such curbs.

• Disruption may impact semiconductors, electronics, defence manufacturing, and clean energy transition.

• The government has launched the National Critical Mineral Mission (NCMM) to:

  • Secure India’s supply chain,

  • Boost domestic exploration and production,

  • Reduce reliance on foreign sources.

  • Under NCMM, India will engage in 1,200 mineral exploration projects and incentivise private investment.

India's Stand or Way Forward

• State-owned Indian Rare Earths Ltd (IREL) handles light REE extraction from beach sand in Kerala.

• India must diversify supply sources, develop refining capabilities, and scale up REE mining.

• Government’s strategic focus on critical minerals highlights long-term self-reliance goals in high-tech sectors.

Global Relevance

• With China refining almost all global REEs, any restrictions have multinational implications.

• Countries like Japan, U.S., and Australia are also impacted; global supply chains face uncertainty for weeks.

• The issue stresses the fragility of global dependencies on single-nation monopolies for strategic resources.

Challenges Ahead

• India’s current REE capacity is minimal despite having reserves.

• Scaling up exploration, refining tech, and environmental safeguards will require long-term policy support.

• Geopolitical volatility (e.g., Russia-Ukraine war) adds urgency to critical mineral independence.

Mains Mock Question:

“Discuss the strategic significance of Rare Earth Elements (REEs) for India’s economy and security. How can India reduce its dependency on China for REEs and build domestic resilience?”