China tightens hold over India's imports for new-age sectors

INDIA-US PACT AIMS LONG-TERM SUPPLY RESET

- SAURAV ANAND

INDIA IS SEEKING to diversify its sourcing network for new-age manufacturing, for which it has set ambitious targets. But China’s grip over India’s clean-energy and advanced manufacturing supply chain is only getting stronger.

The northern neighbour controls more than 84% of India’s lithium-ion battery imports, 78% of permanent magnet supplies and over half of lithium carbonate imports. This sets the context for India's newly signed critical minerals framework with the United States.

India’s imports of selected critical minerals and rare earths rose 6.45% year-on-year to $521.75 million in FY26 from $490.12 million in FY25 as demand accelerated from electric mobility, battery storage systems, semiconductors, electronics and renewable energy manufacturing.

The India-US critical minerals framework signed on May 26 seeks to gradually reshape supply chains across mining, refining, processing, recycling and strategic investments as both countries attempt to build “trusted” alternatives to China-dominated networks. The scale of China’s dominance remains particularly visible in downstream manufacturing ecosystems that determine global clean-energy economics.