Indian Auto Industry Delegation Awaits Chinese Visas For Urgent Magnet Supply Talks

A high-level delegation of Indian automakers, led by officials from the Commerce Ministry, is poised to visit China to address an escalating crisis in the supply of rare earth magnets, critical for both electric and conventional vehicle production, The Hindu Businessline reported.

The delegation is currently awaiting visas and a formal appointment from the Chinese government to meet suppliers and expedite export licenses, sources confirmed to media on Tuesday.

The urgency stems from China’s new export regulations, effective 4 April 2025, which have disrupted magnet imports, threatening production halts across India’s auto sector by early June.

The Indian auto industry, heavily reliant on China for 90 per cent of its rare earth magnet supply, faces severe bottlenecks due to delays in import clearances.

These magnets are essential components in traction motors for electric vehicles (EVs) and other vehicle parts, with even a single missing component capable of stalling production lines.

Industry insiders cited in the report warn that existing inventories may deplete within days, risking significant disruptions for major manufacturers.

To mitigate tensions, Indian vendors have submitted end-user certificates to certify that the magnets are for non-defense applications, a key requirement under China’s tightened export rules.

The delegation’s visit aims to streamline these procedural hurdles and secure uninterrupted supplies.

Simultaneously, the Ministry of Heavy Industries, under Union Minister HD Kumaraswamy, convened a stakeholder meeting on 3 June to finalise a concept note for promoting domestic magnet production.

This long-term strategy includes incentives for local mining and manufacturing to reduce dependence on Chinese imports.

The government is also exploring alternative suppliers in countries like Japan and South Korea, though scaling up non-Chinese sources remains challenging in the short term.

“We are diversifying, but China’s dominance in rare earths is a reality we must navigate for now,” a Commerce Ministry official was quoted as saying.

Industry bodies like the Society of Indian Automobile Manufacturers (SIAM) have urged swift government intervention, warning of broader economic impacts if production halts.

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