Highlights

• India possesses 6.9 million tonnes of rare earth reserves (3rd globally) yet contributes less than 1% of production versus China's 270,000 tonnes, revealing a decades-long structural policy failure rather than mere regulatory delays.
• The bottleneck is processing power: China controls 90% of global refining and virtually all heavy rare earth processing—the critical stage for magnets, defense systems, and electronics that India has failed to develop.
• India's Japan joint venture in Visakhapatnam, while real, remains symbolic without industrial-scale integration; rare earth dominance requires vertically integrated systems linking mining through end-use manufacturing, not pilot facilities.

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A recent Times of India report (opens in a new tab) makes a claim that sounds paradoxical but is, in fact, painfully familiar to anyone who studies rare earth supply chains: India holds the world’s third-largest rare earth reserves, yet contributes less than 1% of global production. The story is directionally correct—but incomplete in ways that matter for investors, policymakers, and anyone serious about industrial power.

The Numbers That Matter—and Mostly Hold Up

The article accurately notes that India has roughly 6.9 million tonnes of rare earth reserves, largely concentrated in monazite-rich coastal sands. It also correctly reports that India’s 2024 production—about 2,900 tonnes—is negligible compared with China’s ~270,000 tonnes and even trails countries with far smaller reserves.

It is also accurate to state that processing, not geology, is the binding constraint. China controls ~90% of global rare earth refining and virtually all heavy rare earth processing—the real choke point in magnets, defense systems, and advanced electronics. On this core point, the article aligns with well-established industry data.

Where the Story Becomes Too Gentle

What the piece understates is intentionality. India’s lag is not just the result of “regulatory hurdles” or historical inertia. For decades, rare earths in India were treated as radioactive byproducts, not strategic assets, with mining and processing largely monopolized by the state-owned Indian Rare Earths Limited (IREL (opens in a new tab)).

This framing risks implying a technical or bureaucratic delay—when the reality is a structural policy failure. Countries that dominate rare earths today did not stumble into that position; they built vertically integrated systems linking mining, separation, metallurgy, magnet-making, and end-use manufacturing. India did not.

The Japan Joint Venture: Real, but Symbolic

The piece today mentions India’s joint venture with Japan in Visakhapatnam. That detail is accurate—and important—but its scale is modest. It does not meaningfully change India’s position in the global supply chain. One pilot facility does not equal an industrial ecosystem.

This distinction matters because rare-earth power is cumulative. Without scale, skills, and downstream demand, processing plants remain stranded assets.

What’s Notable in the Global Context

What makes this story notable now is the timing. As the U.S., Europe, and Japan scramble to diversify away from China, India should be a natural partner. Instead, it remains a resource-rich bystander—a reminder that reserves alone confer no leverage.

The rare earth lesson is blunt: processing is power. Until India confronts that reality with an industrial policy—not just reports—it will continue to watch others monetize its geology.

Bottom Line for REEx Readers

The Times of India article is factually sound but strategically soft. It describes the symptoms, not the disease. India’s rare earth problem is not scarcity. It is execution, integration, and political will—the same triad that separates mineral ownership from mineral dominance.

Source: The Times of India, Dec 29, 2025

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