C3S ISSUE BRIEF XXVII - An Assessment of China’s Dominance in Rare Earth Elements And India’s Strategic Response: By Sagnik Nandi.

Guided by Abia Fathima, Research Officer, C3S

Abstract

Rare Earth Elements (REEs) have emerged as indispensable components of present day economic and military architecture, playing a significant role in domains such as EV, renewable energy and advanced military systems. The People’s Republic of China like the US was an early entrant into the sector and began to invest heavily in it ever since the 1950s. An undoubtedly important factor in China’s consolidation in the field of REEs is control by the central government and the creation of policy guidelines that have led to the development of the sector. As early as the 1990s, the Chinese government designated rare earths as ‘protected and strategic elements’. Moreover, China has built ‘strategic blocks’ of REE’s to protect it from geopolitical turbulence and shocks. The strict export control imposed by Beijing in 2025 on seven REE’s demonstrates the deliberate strategy of China especially as it comes in the backdrop of Western supply chain strain owing to the conflict in Gaza and Ukraine. Of these seven REEs, China accounts for the largest production of Samarium, an REE which has the capability to withstand high temperatures and is used in the production of high scale military equipment like the F-35 fighter jets. Such a restriction has exposed a supply chain risk for the US and EU’s military-industrial complex which relies heavily on Samarium. Moreover, China has pursued investment ventures across Africa alongside its Belt and Road Initiative (BRI) to integrate its REE supply chain. Notable examples include investments in Tanzania and the Central African Republic. Amidst this geopolitical calculus, India also faces strategic vulnerability in terms of REE production. While it possesses rare earth deposits in some particular regions such as Odisha and Andhra Pradesh, its processing capacity remains limited. Moreover, as India attempts to modernise its military under its ‘Make in India’ Programme, its reliance on Chinese minerals exposes significant contradictions. India has attempted to reduce its vulnerability through initiatives such as the National Critical Minerals Mission, Rare Earth Permanent Manufacturing Scheme. It has also been pursuing multilateral engagements such as the Minerals Security Partnership, QUAD Critical Minerals Initiative and preferential agreements with resource rich nations. 

This study attempts to analyse China’s strategy in rare earth elements and its implications for India’s economic and strategic security. While global narratives often examine US-China rivalry in the domain, relatively less attention has been paid in examining India’s implications and response.  The research seeks to address the following questions : 1. How has China established and maintained its dominance in the sector? 2. What are the strategic implications for India and how it can reduce its dependence on the same 3. Can alternate technologies emerge as an alternative to Rare Earth Elements (REEs) ?. Methodologically, the study adopts a qualitative approach relying on policy drafts, secondary data and existing literature in the domain.

Read the full Issue Brief at this link:

C3S Issue Brief XXVII.pdf

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Sagnik Nandi is a Postgraduate student of MA Political Science and International Studies at Jadavpur University, Kolkata.