India’s Rare Earth Breakthrough: Samarium-Cobalt Magnet Production Signals Strategic Setback for China’s Global Dominance

India’s Rare Earth Breakthrough: Rare earth elements are being discussed extensively around the world these days. It's being said that they could transform future technology and the power dynamics of nations. They're even being called the "new oil" of the 21st century. In fact, they're a group of 17 rare metals called rare earth elements (REEs). These metals are a crucial part of many of our everyday gadgets and machines, including smartphones, electric vehicles, windmills, and even defense systems.

A report by Kotak Mutual Fund eloquently explains that while these metals remain hidden from public view, they are quietly playing a role in leading us towards clean energy, a strong economy, and a sustainable future. Now that the world has recognized the importance of these metals, India is determined not to be left behind. The country is preparing to make them its next big strength.

What are these rare earths?

These 17 metals, known as rare earths, aren't actually that rare, but refining them and making them usable is extremely complex, expensive, and environmentally challenging. This very quality makes them extremely strategic and valuable. They play a role in just about every modern technology today. The smartphone in your pocket, the electric vehicles of the future, and the advanced weapons that protect our borders all depend on them. Whoever has the ability to control the supply of these metals will be at the forefront of the 21st century's technological race. This is why countries around the world are making every effort to ensure their supply.

India's claim is strong

Currently, China dominates this "new oil" game. China mines approximately 70% of the world's rare earths, but its true strength lies in its refining capabilities. China refines 90% of the world's rare earths, meaning that regardless of the country in which the mine is located, most of the world relies on China to make them usable. But this scenario is about to change. India, which possesses approximately 6% of the world's rare earth reserves, is emerging as a reliable alternative to reduce this global dependence. While our production currently represents less than 1% of the global total, this situation is rapidly changing. States like Kerala, Tamil Nadu, Odisha, Andhra Pradesh, and Gujarat have large reserves of these minerals, opening up future opportunities.

India's 'Mission Critical Mineral'

The Indian government has taken this challenge seriously. The government launched the National Critical Mineral Mission (2025), which aims to rapidly expand exploration, mining, and processing. A major breakthrough in this direction was recently achieved when the state-owned company IREL (India) Limited was removed from the US export control list. This is a major step, as it opens the door to international collaboration and advanced technology for India.

IREL will soon open a new facility in Visakhapatnam to domestically produce samarium-cobalt magnets. These magnets are crucial for high-tech and defense equipment. This move will strengthen India's technological self-reliance. Furthermore, India is strengthening its presence in the global market through KABIL (Khanij Bidesh India Limited) and the US-led Mineral Security Partnership (MSP).

China's dominance will decrease

Major countries, especially the United States and Australia, are now seeking to reduce their dependence on China and seek a balanced supply chain. The International Energy Agency (IEA) also estimates that China's share in mining could decline from 69% to 51% by 2030, and in refining from 90% to 76%. This presents a golden opportunity for India.

Government reforms to the Mines and Minerals (Development and Regulation) Act and schemes like the Production Linked Incentive (PLI) are encouraging the private sector to invest in this challenging sector. Demand for these rare earth elements is projected to increase significantly by 300% to 700% by 2040. India's efforts are not just aimed at meeting domestic needs, but also a major step toward establishing India as a global leader in clean technology under the "Make in India" initiative.