Inside Forbes India From China’s Grip to Made in India: The rare earth magnet dilemma
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Jul 8, 2025 
Manu Balachandran, an expert in the automotive industry, dives deep into the global shortage of rare earth magnets and its significant impact on India's auto sector. He discusses the heavy reliance on China for these critical materials and the resulting geopolitical tensions. Balachandran outlines potential solutions, including India's push for a domestic rare earth ecosystem. He highlights challenges within the EV market, from consumer hesitance due to limited charging infrastructure to the need for robust government initiatives. It's a crucial conversation on self-reliance and innovation.
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Critical Role of Rare Earth Magnets
- Rare earth magnets are critical for electric vehicles and various technologies but mining and supply are dominated by China.
- Supply disruptions due to geopolitical tensions and tariffs are causing immediate challenges for India's auto industry.
Auto Industry's Supply Dilemma
- Automakers currently have limited buffer but expect supply issues to continue unless China eases exports.
- Long-term strategies include reducing dependency through Indian mining and alternative technologies.
India's Late but Crucial Response
- India's government has proposed incentives to build a domestic rare earth ecosystem but actions are still nascent.
- Execution will be crucial to avoid future supply crises similar to semiconductor shortages.