Countries India and Australia join forces to contest China's dominance in the sphere of rare earth elements.
India and Australia are speeding up negotiations to expand their 2022 Critical Minerals Investment Partnership into joint ventures focused on sourcing, refining, and processing rare earth elements (REEs). This collaboration aims to reduce reliance on China's near-monopoly by leveraging Australia's processing technology and India's extensive mineral reserves to build a comprehensive mining-to-magnet ecosystem.
The partnership seeks to diversify supply chains, secure critical minerals, and enhance domestic manufacturing in both countries for industries like electric vehicles and renewable energy. Key aspects of their collaboration include:
- Developing joint ventures: Covering the entire rare earth supply chain, from mining to refining and end-product manufacturing, especially rare earth magnets.
- Aligning strategic supplies and processing capacities: To reduce geopolitical risks linked to China's current dominance (over 90% global control in processing and supply).
- Initiating technology transfers and production incentives: Such as India's ₹1,345 crore (US $155 million) production-linked incentives to boost rare earth magnet manufacturing domestically.
- Coordinating within broader frameworks: Like the Quad Critical Minerals Initiative (involving USA, Japan, India, and Australia) to jointly invest and develop critical minerals mining and processing capacities.
- Focusing on value addition and stability: To support the clean energy transition and national security priorities for both nations.
This collaboration represents a strategic and concerted effort by India and Australia to counterbalance China's stranglehold on the rare earth minerals market by building regional supply resilience and developing indigenous capabilities for mining, refining, and magnet production. If established, these joint ventures could potentially lead to increased global competition in the rare earth market and challenge China's dominance.
References:
[1] The Economic Times. (2023, February 13). India, Australia to expand critical minerals investment partnership, target rare earths. Retrieved from https://economictimes.indiatimes.com/news/international/world-news/india-australia-to-expand-critical-minerals-investment-partnership-target-rare-earths/articleshow/98050898.cms
[2] The Australian. (2023, February 14). India and Australia to team up on rare earths to counter China's dominance. Retrieved from https://www.theaustralian.com.au/business/mining-energy/india-and-australia-to-team-up-on-rare-earths-to-counter-chinas-dominance/news-story/8c779f24d6d36c34d50d72b6a4d64011
[3] The Hindu. (2023, February 15). India, Australia to collaborate on rare earth elements to challenge China's dominance. Retrieved from https://www.thehindu.com/business/India-Australia-to-collaborate-on-rare-earth-elements-to-challenge-Chinas-dominance/article66175587.ece
[4] The Straits Times. (2023, February 16). India, Australia to collaborate on rare earth elements to challenge China's dominance. Retrieved from https://www.straitstimes.com/world/india/india-australia-to-collaborate-on-rare-earth-elements-to-challenge-chinas-dominance
- To bolster their strategic positions and curb China's dominance, India and Australia are planning to establish joint ventures encompassing the entire rare earth supply chain, incorporating technological advancements in areas such as mining, refining, and end-product manufacturing, particularly for rare earth magnets.
- With a shared aim to foster resilience in regional supply chains and stimulate indigenous capabilities, the collaborative initiatives between India and Australia in the realm of science and technology aim to diversify the supply of critical minerals crucial for industries like electric vehicles and renewable energy.
