India Halts Rare Earth Exports to Japan Amid Global Supply Chain Shifts
| Category | Details |
|---|---|
| Event | India suspends rare earth export agreement with Japan |
| Parties Involved | IREL (India) & Toyotsu Rare Earths India (subsidiary of Toyota Tsusho, Japan) |
| Agreement Year | 2012 |
| Key Material | Neodymium (used in magnets for EV motors) |
| Reason for Suspension | Rising domestic demand, need to develop indigenous processing capacity, and global supply chain uncertainties due to China's export restrictions |
| FY2024 Data | - Toyotsu shipped 1,000+ metric tons to Japan<br>- India mined 2,900 metric tons rare earths<br>- Domestic demand rose due to Chinese supply cuts |
| India's Rare Earth Status | Holds 5th-largest reserves (~6.9 million metric tons); lacks magnet production facilities; depends heavily on imports (53,748 metric tons of rare earth magnets imported in FY2024-25) |
| IREL's Expansion Plans | - Extract 450 metric tons of Neodymium by FY2026<br>- Double production by 2030<br>- Plants in Odisha (extraction) and Kerala (refining)<br>- Exploring partnerships for domestic magnet manufacturing |
| Global Context | China controls over 80% of global rare earth processing<br>Used in EVs, wind turbines, medical devices, smartphones, and defence applications |
| China's Restrictions | China's export restrictions since April 2025 have caused industry-wide alarm |