'Hindi Chini Bhai-Bhai?' Beijing Resumes Rare Earth Magnet Shipments to India After 6-Month Freeze

China has resumed rare earth magnet exports to India after a six-month suspension, easing supply chain tensions for India's electric vehicle and electronics sectors.China has reopened rare earth magnet supplies to India after a six-month halt, offering critical relief to India’s electric vehicle, renewable energy and electronics industries. However, the resumed shipments come with strict geopolitical caveats amid heightened US –China trade tensions.

According to a report by The Economic Times, Beijing has allowed four Indian companies to import rare earth magnets, but on the condition that the materials cannot be re-exported to the United States and cannot be used for military manufacturing.

The move marks a significant thaw in supply chain friction triggered by China’s export control measures in April, imposed after US tariff escalations under President Donald Trump.

Who Can Import? Four Indian Firms Get Clearance

As per ET sources, the Chinese government approved imports for four firms:

Hitachi

Continental

Jay-Ushin

DE Diamonds

Industry executives quoted in the report said the approvals were issued after companies submitted end-user certificates (EUCs) guaranteeing that magnets would be used only for domestic civilian applications.

“There seems to be some easing in supplies. Four companies have got approvals,” a senior industry executive told ET.

Officials added that direct flights between Kolkata and Guangzhou have resumed, improving logistics for supply movement.

MEA Confirms Approvals, Flags Geopolitical Sensitivity

The Ministry of External Affairs also acknowledged the development.

MEA spokesperson Randhir Jaiswal confirmed that India has begun receiving import licences from China, but cautioned that the situation is tied to ongoing US – China trade dynamics:

“We have to see how US – China talks play into our domain,” Jaiswal said.

The easing comes shortly after a meeting between President Donald Trump and Chinese President Xi Jinping, where, as Trump claimed aboard Air Force One, both sides agreed on a one-year rare earth supply understanding — a deal that reportedly influenced Beijing’s decision.

Why This Matters: Rare Earths Power India's Future Industries

Rare earth magnets are vital for:

EV motors

Wind turbines & renewable energy systems

Aerospace & defence components

Consumer electronics

China controls ~90% of global rare earth output, giving it deep leverage in global tech supply chains.

India imported 870 tonnes of rare earth magnets worth ₹306 crore in FY25, ET reported.

Background: Why Supplies Were Frozen

On April 4, 2025, China imposed export controls on heavy rare earth materials citing national security, after the US raised tariffs on Chinese goods. Companies were required to secure special licences and prove materials would not support weapons of mass destruction or related systems.

While supplies to Europe and Southeast Asia resumed earlier, India continued facing delays — until now.

Industry Outlook

With limited approvals granted so far, companies expect partial but critical relief, though concerns remain over:

Geopolitical risks

Future supply barriers

Need for domestic rare earth capability

Industry observers believe this step signals a temporary diplomatic opening, but supply remains vulnerable to global trade negotiations.

China’s conditional rare-earth supply restart to India marks a strategic shift at a delicate geopolitical moment — offering industrial relief, but under close watch of Washington-Beijing dynamics.

Indian companies can breathe easier for now, but long-term supply security will depend on ongoing diplomatic maneuvering and India's efforts to build strategic mineral resilience.

News is originally taken from: https://bit.ly/49tolsg

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