China eases rare earth export curbs for civilian use amid supply concerns. What it means for India
The move, announced on December 19, follows sustained diplomatic engagement by New Delhi, which has repeatedly flagged concerns over the availability of rare-earth elements critical to sectors such as automobiles, electronics, renewable energy, and advanced manufacturing.
- Dec 19, 2025,
- Updated Dec 19, 2025 10:54 PM IST
China’s decision to approve exports of rare-earth metals strictly for civilian use has offered cautious relief to Indian industries grappling with supply shortages, even as Beijing continues to retain firm control over materials with potential defence applications.
The move, announced on December 19, follows sustained diplomatic engagement by New Delhi, which has repeatedly flagged concerns over the availability of rare-earth elements critical to sectors such as automobiles, electronics, renewable energy, and advanced manufacturing. Chinese authorities said export controls on rare-earth-related items are not targeted at any specific country and that applications meeting regulatory requirements for civilian use would be cleared.
China’s Foreign Ministry underlined that the restrictions are rooted in the dual-use nature of medium and heavy rare earth elements, which can be deployed in defence equipment. Exports that could support military applications would not be permitted, it said, describing the controls as aligned with international practice and global non-proliferation norms.
In a parallel statement, China’s Commerce Ministry confirmed that it has already approved export applications from some domestic companies, indicating that shipments have resumed after curbs imposed earlier this year amid escalating trade tensions with the United States. Given China’s dominant position — accounting for around 70% of global rare-earth mining and nearly 90% of processing — any shift in its export policy has significant implications for global supply chains.
Implications for India
For India, the opening of a civilian-use approval window provides short-term relief to industries that had begun to feel acute supply stress. Automobiles, electronics, renewable energy equipment, and precision manufacturing are among the sectors expected to benefit most in the near term.
Indian officials have raised the issue of rare-earth shortages in several bilateral forums. During foreign ministry consultations held in Beijing on December 12, New Delhi pressed for an early resolution of export control issues. In a statement after the talks, the Ministry of External Affairs said the Indian side had “emphasised on the need for early resolution of outstanding issues pertaining to export control,” adding that broader regional and global developments were also discussed.
However, the episode has once again highlighted India’s strategic vulnerability stemming from its heavy dependence on Chinese rare-earth supplies. While approvals for civilian use may stabilise imports in the immediate future, uncertainty persists for sectors where civilian and defence applications overlap, leaving long-term supply security unresolved.
The development also reinforces India’s broader strategy to diversify supply chains. New Delhi has been stepping up efforts to invest in domestic rare-earth mining and processing while deepening partnerships with alternative suppliers such as Australia and the United States.
Geopolitical leverage
China’s export controls were tightened earlier this year amid a tariff war with the US, squeezing global supplies of the critical metals. Indian industry bodies subsequently flagged growing concerns, particularly in the automobile sector, prompting New Delhi to raise the matter across multiple dialogue platforms.
Beijing began easing some of these controls after reaching an understanding with Washington that allowed the export of semiconductor chips crucial for China’s rapidly expanding artificial intelligence industry. Alongside rare earths, India has also urged China to permit exports of heavy boring machines used in mining, another area where restrictions have affected domestic capacity expansion.
While China’s latest decision offers temporary relief, it also serves as a reminder of the geopolitical leverage embedded in rare-earth supply chains — underscoring why India is likely to keep pushing for diversification and self-reliance in the years ahead.
China’s decision to approve exports of rare-earth metals strictly for civilian use has offered cautious relief to Indian industries grappling with supply shortages, even as Beijing continues to retain firm control over materials with potential defence applications.
The move, announced on December 19, follows sustained diplomatic engagement by New Delhi, which has repeatedly flagged concerns over the availability of rare-earth elements critical to sectors such as automobiles, electronics, renewable energy, and advanced manufacturing. Chinese authorities said export controls on rare-earth-related items are not targeted at any specific country and that applications meeting regulatory requirements for civilian use would be cleared.
China’s Foreign Ministry underlined that the restrictions are rooted in the dual-use nature of medium and heavy rare earth elements, which can be deployed in defence equipment. Exports that could support military applications would not be permitted, it said, describing the controls as aligned with international practice and global non-proliferation norms.
In a parallel statement, China’s Commerce Ministry confirmed that it has already approved export applications from some domestic companies, indicating that shipments have resumed after curbs imposed earlier this year amid escalating trade tensions with the United States. Given China’s dominant position — accounting for around 70% of global rare-earth mining and nearly 90% of processing — any shift in its export policy has significant implications for global supply chains.
Implications for India
For India, the opening of a civilian-use approval window provides short-term relief to industries that had begun to feel acute supply stress. Automobiles, electronics, renewable energy equipment, and precision manufacturing are among the sectors expected to benefit most in the near term.
Indian officials have raised the issue of rare-earth shortages in several bilateral forums. During foreign ministry consultations held in Beijing on December 12, New Delhi pressed for an early resolution of export control issues. In a statement after the talks, the Ministry of External Affairs said the Indian side had “emphasised on the need for early resolution of outstanding issues pertaining to export control,” adding that broader regional and global developments were also discussed.
However, the episode has once again highlighted India’s strategic vulnerability stemming from its heavy dependence on Chinese rare-earth supplies. While approvals for civilian use may stabilise imports in the immediate future, uncertainty persists for sectors where civilian and defence applications overlap, leaving long-term supply security unresolved.
The development also reinforces India’s broader strategy to diversify supply chains. New Delhi has been stepping up efforts to invest in domestic rare-earth mining and processing while deepening partnerships with alternative suppliers such as Australia and the United States.
Geopolitical leverage
China’s export controls were tightened earlier this year amid a tariff war with the US, squeezing global supplies of the critical metals. Indian industry bodies subsequently flagged growing concerns, particularly in the automobile sector, prompting New Delhi to raise the matter across multiple dialogue platforms.
Beijing began easing some of these controls after reaching an understanding with Washington that allowed the export of semiconductor chips crucial for China’s rapidly expanding artificial intelligence industry. Alongside rare earths, India has also urged China to permit exports of heavy boring machines used in mining, another area where restrictions have affected domestic capacity expansion.
While China’s latest decision offers temporary relief, it also serves as a reminder of the geopolitical leverage embedded in rare-earth supply chains — underscoring why India is likely to keep pushing for diversification and self-reliance in the years ahead.