Loosen China’s grip on rare earths: India can and must

Early last month, China tightened its policy on rare earths. Two of China's biggest players, Baogang Group and Northern Rare Earth, immediately announced sharp price increases of 37%. Other suppliers have indicated even larger increases, resulting in a coordinated tightening of the market.

- NARAYAN RAMACHANDRAN

What are rare earths? Rare earth elements are a set of 17 heavy metals on the periodic table. Fifteen of these, with atomic numbers from 57 to 71, are 'lanthanides.' Two other metals, scandium (Atomic No. 21) and yttrium (Atomic No. 39) are also rare earth elements. These typically occur in various chemical combinations and such minerals are called 'rare earth minerals.' Most often, these minerals are made up of rare earth oxides. When refined, these oxides result in rare earth metals of high purity that are critical in today's economy. These metals allow the manufacture of some of the most economically and strategically valuable products of the 21st century, from computer processors, advanced alloys and electric vehicles to consumer electronics and industrial machinery.

Why have rare earth metals suddenly become so central to global geopolitics? China dominates their refining and supply, with a nearly 90% market share. China has also shown its willingness to use this dominance as a non-tariff response in its trade conflict with the US. From a supply-chain point of view, the medium-term implications of this are so important to the US and other large economies that it is a credible 'card' for China to play.