November 1, 2025

New Delhi: After six long months of waiting, Indian companies in electric vehicles, renewable energy, and electronics finally got some relief! China has started supplying heavy rare earth magnets to India again. But hold your excitement, Beijing has set strict rules: these magnets can’t be re-exported to the US, nor can they be used for any military purposes, sources say. Why this sudden move? China and the US have been in a tough trade war. However, following a recent friendly chat between US President Donald Trump and China’s Xi Jinping on Thursday, steps are being taken to ease tensions a bit. This thaw means China has allowed four Indian buyers to import rare earth magnets again. These buyers include big names like Hitachi, Continental, Jay-Ushin, and DE Diamonds. Earlier reports revealed that China demanded strong promises — India had to submit end-user certificates guaranteeing the magnets wouldn’t build weapons or be sent to the US market. Many of these applications were stuck waiting for China’s Ministry of Commerce approval, but finally, clearance seems to be coming through. One senior industry insider told ET, "There seems to be some easing in supplies. Four companies have got approvals for importing rare earth magnets.” Big news! Also, direct flights between India’s Kolkata and China’s Guangzhou have resumed, making trade smoother. The Ministry of External Affairs spokesperson Randhir Jaiswal confirmed this development but added with caution, "We have to look at how the US and China talks will play into our domain.” So, the journey of rare earth magnets will continue to be watched closely. Why are these magnets so important? EV makers absolutely love them! They power motors in electric vehicles and are critical for high-tech sectors like renewable energy, electronics, aerospace, and defense. Since China produces a whopping 90% of these magnets globally, their supply is very sensitive. Back on April 4, China clamped down with export controls to protect its national security, saying that buyers must prove these magnets won’t be used for military weapons, especially in response to US tariffs. India, which imported 870 tonnes worth ₹306 crore in fiscal year 2025, was not getting these magnet supplies for months — until now. In a surprise announcement earlier today, President Trump said the US and China agreed on a one-year deal for critical rare earth materials. Could this jumpstart a fresher wave of global supplies? For now, Indian industries breathe a sigh of relief as their vital magnet supplies pick up with this delicate new understanding between the global giants.

Read More at Economictimes →

Tags: China, India, Rare earth magnets, Electric vehicles, Trade war, Us-china relations,