Why did China prohibit the export of rare earth elements?

• China has imposed export controls on rare earth elements (REEs) and magnets used in various manufacturing activities.

• These elements are classified as dysprosium, gadolinium, lutetium, samarium, scandium, terbium, and yttrium.

• These elements are used in hard disks, car motors, nuclear reactors, medical equipment, PET scanners, and in petroleum refineries.

• The export restrictions could disrupt supplies to countries for a few weeks as refiners work through the process of getting permits.

• India’s supply chains may not be immediately impacted by the restrictions. The government has taken steps to boost domestic production of semiconductors and defence equipment.

• India recognizes the importance of REE production, with an estimated 6% of their total deposits.

• India has light REE extraction capabilities through the state-owned Indian Rare Earths Ltd.

• India imports a limited quantity of REEs, with 2,270 tonnes imported in 2023–24.

• The government’s plan is to increase domestic production and imports of critical minerals, including REEs, under the National Critical Mineral Mission (NCMM).