India gets relief as China moves to lift curbs on rare earths, fertilisers

The restrictions on three key items were raised by External Affairs Minister S Jaishankar during his meeting with Chinese Foreign Minister Wang Yi last month

China has reportedly agreed to address India’s concerns over its export curbs on fertilisers, rare earth magnets/minerals, and tunnel boring machines. The move follows talks between Foreign Minister Wang Yi and External Affairs Minister S Jaishankar last month.

 

On his two-day visit to India, Wang Yi reportedly assured Jaishankar that Beijing has begun responding to New Delhi’s requests on the three commodities, reported The Economic Times. 

Why it matters

Fertiliser curbs disrupted Di-Ammonium Phosphate (DAP) supply during the Rabi season.

Tunnel boring machines destined for India’s infrastructure projects were held back, including equipment made by foreign companies in China.

 

India’s automobile and electronics industries repeatedly flagged shortages of rare earth magnets, warning of production risks.

 

According to reports, China’s restrictions were linked to national security considerations amid tensions with India. 

Rare earth magnet export curbs

In April, China mandated special export licences for seven rare earth elements and related magnets. On August 14, a PTI report said that the Indian government is engaging with China on the issue of the rare earth magnet.

 

"Efforts are on. In fact, when we last approached the Embassy of China, they had also issued visas to our companies, and they are in touch with Chinese authorities, and they are also finding means and ways by which the supply chain does not get impacted. So efforts are on in that direction," PTI quoted an official as saying.

 

Earlier, Business Standard reported that automakers, including Bajaj Auto, cut production due to shortages. The Ministry of Heavy Industries is also planning a ₹1,345 crore subsidy scheme to promote domestic manufacturing of rare earth magnets.