India Allows Direct Import of RE Magnets to Support EV Sector

The Government of India has granted the first batch of import licences for rare earth (RE) magnets from China to four Indian companies, including Hitachi India and Continental India.

This step is expected to ease pressure on India’s automotive and EV industries, which have been facing supply shortages since China tightened export rules on these critical materials in April 2025.

India Allows Direct Import of RE Magnets to Support EV Sector

Breakthrough in Supply Chain Access

This is the first major approval after China — which controls nearly 90% of global rare earth magnet production — imposed strict export controls.

The imported magnets, especially neodymium-iron-boron (NdFeB) types, are vital for EV motors, wind turbines, and high-performance electronics.

Because India relies heavily on Chinese RE magnets, local manufacturers had raised concerns about production delays and rising costs.
Now, the import approval ensures smooth supply for Indian industries.

Conditional Licences and Oversight

The issued licences come with strict government monitoring.

• Companies must ensure that the magnets are used only for civilian and automotive purposes, not for defence or strategic use.
• Firms were required to get approvals from the Director General of Foreign Trade (DGFT).
• Importers also needed to provide assurances to Chinese authorities about the end-use of these materials.

According to the Ministry of External Affairs (MEA), this step is vital to maintain industrial continuity and economic stability.

Impact on India’s Automotive Sector

Earlier, due to China’s restrictions, Indian EV companies considered importing entire electric motor assemblies instead of just magnets — which would have increased costs and required major design changes.

With the new licences:

• Indian manufacturers can now continue building their own customised EV motors,
• Avoid production delays,
• And keep costs under control.

This move will help stabilise India’s EV and electronics manufacturing in the short term.

Strategic Move Towards Long-Term Self-Reliance

While this decision provides immediate relief, the government’s long-term goal is to achieve self-reliance in rare earth processing and magnet manufacturing.

Plans include:

• Boosting domestic production,
• Partnering with friendly nations for raw materials, and
• Reducing dependence on Chinese imports over time.

This aligns with India’s Atmanirbhar Bharat (self-reliant India) mission in the high-tech and energy sectors.

Exam-Oriented Facts

• India approved the first batch of import licences for rare earth magnets from China.
• Neodymium-iron-boron (NdFeB) magnets are used in EV motors and wind turbines.
• China produces about 90% of the world’s RE magnets.
• DGFT (Director General of Foreign Trade) monitors import permissions.
• Licences are restricted to civilian and industrial use only.
• Long-term goal: domestic production of rare earth magnets.

Question & Answer

Q1. Which country produces about 90% of the world’s rare earth magnets?
(a) Japan
(b) South Korea
(c) China
(d) USA
Answer: China

Q2. Which type of magnet is critical for electric vehicle motors and wind turbines?
(a) Ferrite magnet
(b) Alnico magnet
(c) Neodymium-iron-boron (NdFeB) magnet
(d) Ceramic magnet
Answer: Neodymium-iron-boron (NdFeB) magnet

Q3. Which Indian authority regulates import licences for rare earth materials?
(a) Ministry of Power
(b) DGFT
(c) NITI Aayog
(d) RBI
Answer: DGFT

Q4. The rare earth magnets imported from China can be used for which purposes?
(a) Defence only
(b) Civilian and automotive only
(c) Military research only
(d) Space projects only
Answer: Civilian and automotive only

Q5. Which global companies’ Indian subsidiaries were among the first to get import licences?
(a) Sony and Samsung
(b) Hitachi and Continental India
(c) LG and Panasonic
(d) Bosch and Tesla
Answer: Hitachi and Continental India

Q6. What is India’s long-term goal regarding rare earth materials?
(a) Increase imports from China
(b) Depend fully on foreign sources
(c) Achieve self-reliance and domestic production
(d) Stop EV manufacturing
Answer: Achieve self-reliance and domestic production

Also Read

🔗 Other Useful Links:
📌 Latest Government Job Vacancies
📌 Latest Exam Results
📌 Free Mock Tests