China grants licences to 4 Indian companies to import rare earth magnets; bars re-export to US

China has resumed supplying heavy rare earth magnets to India after a gap of six months, providing relief to the country’s electric vehicle, renewable energy, and consumer electronics industries that rely heavily on these imports.

“Some Indian companies have received licenses for importing rare earth magnets from China,” External Affairs Ministry spokesperson Randhir Jaiswal said at a weekly media briefing on Thursday.

He, however, did not elaborate on the details.

Hitachi, Continental, Jay Ushin and DE Diamonds have secured approvals from Chinese authorities for imports, reported The Economic Times, citing people aware of the matter.

However, Beijing has imposed conditions that the magnets cannot be re-exported to the United States or used for military purposes, according to the report.

The approvals come after more than 50 applications from Indian firms remained pending for months with China’s Ministry of Commerce.

Rare earth magnets, essential for manufacturing electric vehicles, drones, battery storage systems, and other high-end technologies, have become a strategic commodity amid growing global competition for critical minerals.

China controls about 90% of global production of these magnets and around 70% of rare earth mining, making it a dominant player in the global supply chain.

China’s resumption of supplies to India follows its announcement earlier this month of fresh restrictions on the export of technologies and equipment used in the mining and processing of rare earths, lithium batteries, and related materials.

Beijing’s latest move is being viewed as part of efforts to ease tensions with New Delhi after over four years of a military standoff along the Line of Actual Control (LAC) in eastern Ladakh.

The resumption also coincides with steps to normalise trade relations following US President Donald Trump’s meeting with Chinese President Xi Jinping, where both sides agreed to partly ease trade tensions.

Chinese authorities have also sought assurances from Indian importers that the magnets will be used solely for domestic consumption. Indian firms were required to submit end-user certificates guaranteeing that the components would not be used for manufacturing weapons or exported to third countries.

The resumption of supplies is expected to ease raw material pressures for Indian manufacturers at a time when the government is pushing for self-reliance in the production of critical minerals and advanced technology components.