In order to obtain a rare earth supply license, the Indian automobile industry urges the government to contact China through diplomatic channels to speed up the approval process.
The Times of India quoted a report from the Indian newspaper trust on the 8th as saying that industry insiders revealed that many Indian suppliers have applied for rare earth exports from relevant Chinese departments through their partners in China, but have not obtained any licenses so far. The website of India's First Post said that China has expressed on the 7th that it is willing to speed up the approval of EU companies' rare earth exports, but has not yet expressed its application for Indian companies.
Data photo: May 1, 2025 local time, Kolkata, India. (Visual China)
In April this year, China implemented export controls on seven rare earth elements and related magnets, and export enterprises must apply for licenses from the commercial department of the State Council in accordance with relevant regulations. The Indian Mint reported that this has a significant impact on Indian industry, especially the Indian auto industry. The report mentioned that although India has the world's top five rare earth reserves (about 6.9 million tons), its mining volume is very small, so it relies heavily on imports, especially from China.
Indian media said that India has taken some measures to change the current supply situation. In January this year, the Indian government approved a plan to invest 163 billion rupees (about 13.68 billion yuan) in key mineral industries, and in March it opened licenses for rare earth exploration to the private sector. Reuters quoted sources familiar with the matter as saying this month that India is negotiating with businesses, hoping to build long-term inventory of rare earth magnets by providing fiscal incentives. However, the Mint mentioned that this is far from enough. A report from the Export-Import Bank of India pointed out that India's limited refining and processing capacity has limited the excavation of domestic reserves.
In accordance with the Indian "Republicworld" website and the Indian Financial Express, In the absence of rare earth magnets, Indian automakers may call for power production, or cause delays in delivery of new electric vehicles. Rakesh Sharma, executive director of Bajaj Automobile, admitted that supply and inventory are gradually exhausted, and if the situation does not ease, production in July will be severely affected. Maruti Suzuki, India's largest automaker, said that auto production was not immediately affected, but a model faces production disruptions due to supply chain challenges. Gaolaf Wangar, deputy director of India's light vehicle production forecast for S&P Global Mobile Mobility, said that the situation remains stable and some electric vehicle supply has been affected, but it is still within a controllable range.
The Times of India quoted Rajat Mahajan, who is responsible for the automotive industry in Deloitte India, as saying that several magnets regulated by China have high magnetic energy storage capabilities and low coercivity at high temperatures. "So far, other magnetic materials have not been widely commercially used in areas such as electric vehicle production." Mahajan said that rare earth magnets available for recycling cannot meet the current production needs of electric vehicles, and it is difficult for auto manufacturers to quickly turn to different power systems or alternative materials.
In response, Mahajan said: "I hope this situation can be resolved through diplomatic channels." The Times of India mentioned that earlier last week, Rahul Bati, senior executive of Maruti Suzuki, revealed that the Indian industry is having discussions with the government. According to the Financial Express, the Indian Automobile Manufacturers Association has also contacted the government, hoping that it will intervene through diplomatic means to seek a supply license for rare earth magnets.
Indian media said that India has begun discussions with Vietnam, Indonesia, Japan, the United States and Russia on the supply of rare earth magnets. The Times of India quoted expert analysis as saying that although automakers are exploring ways to reduce their dependence on China, it is still difficult to find a direct alternative.
Source: Global Network
