(MENAFN) India is creating a strategic stockpile of rare earth elements to secure medium-term supply, according to reports citing government sources. The initiative comes amid ongoing trade tensions between China and the United States, including Beijing’s recent restrictions on rare earth magnet exports.

The plan initially targets building a two-month reserve of critical rare earth materials, with private companies playing a significant role, a senior official said. These elements are essential for sectors such as defense, electronics, and batteries for electric vehicles. “The initial focus is on rare earth elements,” the official noted. Future expansions of the stockpile will include other minerals critical to India’s energy transition and manufacturing industries.

China currently dominates the global market, producing roughly 60% of the world’s rare earth magnets. In response to international trade tensions, it recently announced limits on exports. India, by contrast, holds about 7.23 million tonnes of rare earth elements, according to a statement in parliament by Minister of State for Science and Technology Jitendra Singh.

New Delhi has also launched a $156 million subsidy program to promote domestic production of rare earth magnets. The initiative aims to support both private and public sector companies by offering incentives to establish production capacity across all stages of the supply chain.

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