But the most problematic element for electric vehicles—and even wind turbines—is neodymium. Again, if you recall your high school Physics, you’ll know that strong magnets are vital for motors, or in wind turbines, for generating electricity. Neodymium alloys create exceptionally strong magnets that don’t demagnetise easily. The motors these magnets go into must last 10–15 years—the lifespan of a vehicle—and endure wide temperature ranges and rough usage. These aren’t your average blender magnets.
According to the policy chief of a large Indian automaker, India currently imports around Rs 1,200 crore worth of neodymium magnets for electric vehicles from China. The largest importer is Sona Comstar, whose recent application to import these magnets by China.
China’s dominance in rare earths has long concerned many countries, including India and the United States. But it seems no one wanted to do the “dirty work” of mining and refining them—this even applied to lithium, the key component in EV batteries.
So, China didn’t just build global EV giants like BYD—it built the entire ecosystem. Companies like BYD and CATL dominate the battery space and lead most of the innovation and intellectual property development around lithium batteries. And while alternatives for batteries may exist, with certain rare-earths like neodymium, China maintains a stranglehold.
The United States, for example, is now trying to build a supply chain for neodymium, and after China’s export restrictions, India has announced a new policy too. According to a recent Reuters article, India has the rare-earth reserves in the world. However, even in the best-case scenario, it could take three to five years before any new mine becomes operational.
In the meantime, with import applications to China being rejected and companies running low on reserves, several are warning of potential disruptions. Some multinational companies, like , claim to have reserves that could last a year or more. Others are beginning to panic. Bajaj and TVS when China hinted at easing export restrictions, but with India-China relations still tense post-Doklam, Indian industry clearly cannot rely on China. Until Indian firms are granted import licences, alternative sources must be explored—and that starts with mining at home.
Here’s the irony: we all want clean, green mobility—but mining and refining are anything but clean. I’ve seen open-pit coal and iron mines in Jharkhand and witnessed steel-making up close. Rare-earth mining and refining is even more polluting. But what choice does India have other than to depend on itself? We have to ease mining and refining permissions—there is no other way.
On another note: I mentioned Sona Comstar earlier, and I’d like to offer my condolences to the family and friends of Sunjay Kapur, the company’s CEO, who passed away this Thursday at the young age of 53. I had known Sunjay for many years. He was a knowledgeable and erudite voice for India’s automotive component industry, and led his company into the electric age with foresight and excellence. He will be missed.
(Edited by Prashant)
