Mining the Future: The Race For The Rare Earths

Rare Earth: The Race for Tech Supremacy

Rare earth elements (REEs) are the backbone of modern technologies powering electric vehicles, wind turbines, smartphones, solar panels, satellites, and precision-guided missiles. Their magnetic, luminescent, and catalytic properties make them indispensable to the green energy transition and advanced defense systems. As the world shifts to clean tech and AI-driven infrastructure, global demand for REEs is soaring. China’s near-monopoly over processing and exports has raised strategic concerns, prompting the U.S., EU, India, and Japan to diversify supply chains and secure critical mineral reserves. The race for REEs is no longer just economic it’s a geopolitical contest for technological and energy supremacy.

Critical rare earth and strategic minerals such as germanium, gallium, hafnium, and indium have emerged as the backbone of modern technologies and national security. These elements are not rare in abundance but are difficult and costly to extract in pure form, making their supply highly concentrated. They play indispensable roles in advanced electronics, green energy, defense, aerospace, and quantum computing. Germanium is used in infrared optics, night vision, fiber optics, and space-based solar cells. Gallium, crucial for gallium nitride (GaN) chips, powers 5G networks, radar systems, and electric vehicles. Indium is vital for touchscreens, LCDs, and photovoltaic solar panels, while hafnium improves the performance of nuclear reactor components and high-temperature superalloys used in jet engines.

Currently, China controls the majority of global production and refining holding over 80% of the supply of gallium and germanium, and a dominant share in indium processing. This gives Beijing considerable geopolitical leverage. In 2010, China briefly halted rare earth exports to Japan during a territorial dispute, prompting Japan to diversify its supply chain and seek alternative sources.

In April 2025, as Trump administration unleashed Trade war with reciprocal tariffs across the world China responded to it by imposing strict export controls on seven critical medium and heavy rare earths elements. These include samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium all essential components in advanced technologies such as electric vehicle (EV) motors, wind turbines, aerospace alloys, missile guidance systems, and high-performance magnets. The new rules require exporters to obtain government licenses not just for the raw elements but also for their oxides, alloys, compounds, and even finished products. This marked a major shift in China’s rare earths policy, reflecting its growing willingness to weaponize its dominance in the global supply chain as China processes over 90% of the world’s rare earths.

The impact was immediate and far-reaching. Within two months of the curbs, China’s rare earth magnet exports plunged by 75%, sending shockwaves across global supply chains. Major industries, especially automotive and defense, began facing material shortages. U.S. companies like Tesla and GM publicly warned of imminent production disruptions, while European and Japanese firms scrambled for alternative suppliers. Although China briefly suspended some countermeasures as part of a trade truce in May 2025, it notably maintained export controls on these seven rare earths, signaling their continued strategic value.

These restrictions reaffirmed China’s ability to exert geopolitical pressure through its command over rare earth processing, a capability no other nation currently matches. In response, the U.S., EU, Japan, India, and Australia accelerated efforts to diversify rare earth supply chains, exploring domestic mining, strategic reserves, and refining technologies. Yet the global race to reduce dependency on China remains uphill, given the time, investment, and environmental complexity involved in building alternative rare earth ecosystems. Major economies across the world are racing to diversify sources, invest in domestic refining capacity, and create secure supply chains. Strategic stockpiles, trade pacts, and mining partnerships in Africa, Australia, and Latin America are all part of this global effort to reduce dependence on a single producer and ensure technological sovereignty in an increasingly multipolar and competitive world.

India’s Rare Earth Awakening

Rare Earth Elements (REEs) have emerged as the backbone of the 21st-century technological revolution, powering everything from smartphones and satellites to electric vehicles (EVs), renewable energy infrastructure, and advanced defense systems. These 17 metallic elements comprising the 15 lanthanides along with scandium and yttrium possess unique magnetic, conductive, and luminescent properties. Their significance has increased manifold in the age of clean energy and digital transformation, where permanent magnets, batteries, catalysts, and high-performance optics are indispensable. Yet, their distribution across the globe remains highly skewed, and their processing even more concentrated. China currently dominates both the reserves and processing of REEs, leading to geopolitical vulnerabilities for countries heavily dependent on these critical inputs.

India, with its vast mineralogical wealth and a growing appetite for green and high-tech industries, has recognized the strategic imperative of harnessing its rare earth potential. According to the 2025 US Geological Survey, India holds an estimated 6.9 million metric tons of rare earth reserves, about 5% of the global total. These reserves are valued between $100 and $150 billion depending on fluctuating global market prices and processing capacities. India ranks third globally after China (44 million metric tons) and Brazil (21 million metric tons), followed by Australia, the United States, and Greenland. India’s reserves are primarily concentrated in monazite-rich coastal beach sands and certain hard rock deposits, with thorium-bearing monazite providing a rich source of light REEs like lanthanum, cerium, neodymium, and praseodymium.

India has made significant strides in identifying new rare earth element (REE) reserves, bolstering its position as a potential global player in critical minerals. In July 2025, the Geological Survey of India (GSI) and the Department of Atomic Energy announced the discovery of promising REE deposits in Rajasthan’s Jalore and Barmer districts, containing minerals like bastnasite, britholite, and xenotime. These hard rock deposits, notably rich in neodymium and dysprosium, vital for magnets in electric vehicles and defense systems, mark a shift from India’s traditional monazite-rich coastal sands found in states like Kerala, Tamil Nadu, Andhra Pradesh, and Odisha. Additionally, a carbonatite deposit was identified in Gujarat, enhancing India’s REE portfolio.

With an estimated 8.52 million tonnes of REE oxides, including 7.23 million tonnes in monazite and 1.29 million tonnes in hard rocks, India holds the third-largest global reserves. However, only 20% of its geological potential has been explored, and production remains below 1% of global output due to technological and regulatory challenges. The government is promoting private investment and international collaborations, such as with the U.S. and Japan, to develop processing capabilities. A ₹1,000 crore incentive scheme aims to boost domestic magnet production including PLI schemes, reducing reliance on Chinese imports.

Geographically, Andhra Pradesh leads the nation in monazite reserves with 3.78 million tons, followed by Odisha, Tamil Nadu, Kerala, West Bengal, Jharkhand, Gujarat, and Maharashtra. These states form the primary REE corridor of India. Additionally, Gujarat's Ambadungar region and parts of Rajasthan hold hard rock deposits with an estimated 1.29 million metric tons of REEs. In total, India possesses 13.15 million tons of monazite-rich resources, containing approximately 7.23 million tons of Rare Earth Oxides (REO). However, India's reserves are heavily skewed toward light REEs, with limited availability of heavy REEs like dysprosium and terbium, which are essential for high-performance magnets and temperature-resistant applications in EVs and turbines. This imbalance necessitates diversification of both domestic mining and international sourcing.

Despite the abundance of REE resources, India has historically underutilized its potential. In the past decade, the country imported no REEs and exported a mere 18 tonnes, reflecting a lack of downstream processing and advanced material capabilities. This underutilization is gradually being reversed under a comprehensive national strategy. In July 2025, the Government of India, through a written reply in the Parliament, unveiled a sweeping overview of its rare earth strategy. Spearheaded by the Ministry of Mines and the Ministry of External Affairs, India has adopted a multi-pronged approach to securing REEs from domestic exploration and policy reform to global resource acquisition and industrial partnerships.

At the heart of this strategy lies the National Critical Mineral Mission (NCMM), launched in January 2025 with an outlay of ₹16,300 crore and expected investment of ₹18,000 crore from public sector undertakings (PSUs) and private players. The mission spans from FY 2024–25 to FY 2030–31 and aims to catalyze the full spectrum of the REE value chain, from exploration to refining and end-use applications. It supports the creation of processing parks (₹500 crore), recycling incentives (₹1,500 crore), pilot mineral recovery projects (₹100 crore), and R&D support for start-ups and MSMEs. The NCMM serves as the fulcrum of India’s efforts to reduce reliance on China, which currently accounts for about 90% of global REE processing.

Policy reforms have been critical in unlocking India's rare earth potential. The Mines and Minerals (Development and Regulation) Amendment Act, 2023, passed in August 2023, removed key minerals like lithium, titanium, niobium, tantalum, and zirconium from the list of atomic minerals, thereby opening them up for commercial mining. It also identified 24 minerals as "critical and strategic," allowing exclusive auctions for mining leases and introducing exploration licensing. These reforms catalyzed private participation and streamlined access to previously restricted resources. The Geological Survey of India (GSI) initiated over 195 critical mineral exploration projects in 2024–25 and expanded to 227 in 2025–26, while the National Mineral Exploration Trust (NMET) funded 195 projects, involving 33 private agencies. The government launched five tranches of mining block auctions, including offshore polymetallic nodules and deep-sea critical mineral blocks. Custom duty waivers were announced for over 25 critical minerals in the Union Budgets for 2024–25 and 2025–26.

Among domestic enterprises, the Gujarat Mineral Development Corporation (GMDC) stands out as a key player in India’s rare earth ecosystem. GMDC is developing a major rare earth hub at the Ambadungar deposit in Chhota Udepur, Gujarat. The deposit holds around 1.29 million tons of REEs, predominantly light rare earths such as neodymium, praseodymium, lanthanum, and cerium, with potential traces of dysprosium. GMDC is investing ₹3,000–4,000 crore to establish a comprehensive REE value chain, including open-pit mining, separation plants, and processing infrastructure. Neodymium and praseodymium are critical for NdFeB magnets used in EV motors, wind turbines, and electronic devices. Lanthanum finds applications in NiMH batteries and optics, while cerium is used in catalytic converters, glass polishing, and LED phosphors. If economically viable, dysprosium from the Ambadungar site could enhance India’s capacity to produce high-temperature magnets for aerospace and defense use.

Other PSUs are also aligning with this national push. Coal India Limited (CIL) has signed a memorandum of understanding with Indian Rare Earths Limited (IREL) to jointly explore beach sand minerals in Andhra Pradesh and examine REE extraction from overburden material in coal mines. CIL is investigating the presence of scandium and strontium in its Sathupalli and Ramagundam coalfields in Telangana. These elements have applications in aerospace, fuel cells, and specialized magnets. CIL is also venturing overseas, scouting for lithium and REE assets in Argentina and Chile, part of India’s wider effort to secure foreign critical mineral assets.

Meanwhile, Hindustan Copper Limited is exploring copper-associated REEs in Rajasthan and Jharkhand. Hindustan Zinc, a subsidiary of Vedanta, is analyzing its by-product streams from zinc mining for trace REEs, aiming to integrate refining capabilities. While IREL, under the Department of Atomic Energy, remains the sole domestic processor of monazite into high-purity REOs, it currently lacks the technology and infrastructure to produce permanent magnets an essential step in the REE value chain. This gap opens up opportunities for private and foreign investment in downstream capabilities.

India is also pursuing international collaborations to secure diversified REE sources. Bilateral ties with Australia are central to this effort. Australia, with significant REE reserves and processing expertise, is a trusted partner under the India-Australia Critical Minerals Partnership. Joint ventures are being pursued in geological data sharing, REE refining, and R&D. Companies like Lynas Rare Earths, a major non-Chinese REE processor, are seen as potential collaborators for India’s refining ambitions. India’s participation in the US-led Minerals Security Partnership (MSP) and the Indo-Pacific Economic Framework (IPEF) reflects its alignment with global democratic efforts to build non-China-centric supply chains for critical minerals.

India’s most ambitious overseas push is via Khanij Bidesh India Ltd (KABIL), a government joint venture formed to acquire mineral assets abroad. In January 2025, KABIL signed a major agreement with Argentina’s Catamarca Minera to explore lithium and REEs across five brine blocks spanning 15,703 hectares in Catamarca province part of South America’s "Lithium Triangle." CIL is also independently evaluating opportunities in Argentina and Chile. Simultaneously, India has expanded outreach to Brazil, the holder of the world’s second-largest REE reserves. Joint ventures with Brazil focus on REEs and niobium, crucial for aerospace alloys and advanced steelmaking.

India’s diplomatic and economic engagement in Africa is a growing pillar of its critical minerals diplomacy. MoUs have been signed with Zambia, Zimbabwe, Mozambique, Malawi, and Côte d’Ivoire for REE exploration, processing, and joint ventures. India is targeting Namibia’s uranium and REE-rich terrains and is in talks with Ghana over lithium and REE cooperation. Agreements with Peru, Bolivia, and the Dominican Republic are also under discussion. These global partnerships are aimed at long-term supply security and include provisions for technology transfer, joint R&D, and workforce training.

Within India’s strategic framework, REEs are not just economic commodities they are national security assets. Elements like neodymium, dysprosium, and praseodymium power missile guidance systems, sonar, radar, and satellite communications. The global competition over semiconductors, batteries, and green energy makes REE autonomy a cornerstone of sovereign technological capability. As India aims for a $10 trillion economy with strong manufacturing, defense, and clean energy sectors, securing a stable, diversified, and domestic REE supply chain becomes indispensable. The projected size of India’s REE market is expected to touch $1.5–2 billion by 2030, making it a major growth sector.

In conclusion, India’s rare earth awakening is both timely and strategic. With strong reserves, supportive policy reforms, mission-level funding, and expanding global partnerships, India is laying the foundation for becoming a global player in the critical minerals supply chain. However, challenges remain particularly in processing capacity, magnet manufacturing, and heavy REE availability. Bridging these gaps will require deeper private sector involvement, foreign technology tie-ups, and long-term investment in research and development. As the world transitions to a green and digital future, India’s REE journey could redefine its role not only as a consumer but also as a provider of strategic resources in the emerging multipolar global order.