China’s Export Curbs Continue to Disrupt Rare-Earth Magnet Supply, Indian EV Makers Seek Alternatives

Despite China’s assurance to address India’s concerns over export curbs on rare-earth elements and magnets, automakers are yet to receive any supply, creating an uncertain environment for the future of EV industry, reported Business Standard.

In August, the Chinese foreign minister Wang Yi had promised External Affairs Minister S Jaishankar that Beijing will ease restrictions on exports of rare-earth minerals, among other items.

Rare-earth magnets and elements, used in automobiles and their components, electronics, medical industry and defence, have been subjected to export licensing norms by China since April 4. 

The curbs came into force as a response to the increased tariffs imposed by United States on Chinese products.

A leading two-wheeler original equipment manufacturer (OEM) said that the company has not received any fresh shipments of rare-earth magnets from China ever since its vendors submitted applications.

Under the new rules, Chinese sellers will now receive export clearance if imports can guarantee that there is no dual-use of the materials or for defence-related applications. The process, however, is complicated and long-drawn.

Since then, India has been in dialogue with China through diplomatic channels to process applications from Indian importers seeking shipments of the critical raw materials.

In June, the Indian automobile industry raised an alarm and flagged their concerns with the Indian government over the export curbs on rare-earth magnets. They had said that delay in approval of imports of these critical raw materials from China’s ministry of commerce was causing disruption in the production schedule of Indian automakers, including electric vehicles (EVs).

EV Industry Faces Uncertainty

India has already started pushing to diversify rare-earth supply chains amid China’s export curbs. Automaker Bajaj Auto recently reported receiving cleared shipments of light rare-earth magnets after weeks of disruptions, reported Reuters.

Meanwhile, firms such as Mahindra & Mahindra are implementing engineering workarounds and exploring alternative technologies to manage the shortages, according to TOI.

A 2025 report by Crisil warned that prolonged delays could slow EV rollouts and disrupt auto production.  This supply shake-up is not only prompting emergency measures but sparking long-term strategies to reduce reliance on Chinese rare-earth exports.

In addition to triggering emergency responses, this disruption in supply is also igniting long-term plans to lessen dependency on Chinese rare-earth exports.