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Critical minerals and rare earths

India's search for critical minerals and rare earths: auctions and finds at home, blocks and alliances abroad, recycling, and the refining that decides who controls supply. Prelims has asked about rare earths and the National Critical Mineral Mission, lithium in Chile, and monazite.

Foundation note: Energy sector and energy security

UPSC has asked

  • Prelims 2025: rare earths in flat screens, and their phosphorescence

Prelims and Mains

LeadCritical minerals: the refinery problemAugust 2026

Why in news

August 2026 brought three developments on one problem: twenty bids came in under India's scheme for rare earth magnets, two pilot plants in Odisha were set to recover rare earths from industrial waste, and fresh data showed how tightly the refining of critical minerals is held by a few countries.

Background

  • A mineral is critical when the economy and the armed forces cannot do without it and its supply can be cut.
  • India's list of 2023 names 30 critical minerals, among them lithium, cobalt, nickel, graphite and the rare earths.
  • The rare earths are 17 metals: the 15 lanthanides with scandium and yttrium.
  • They are not rare in the ground; what is scarce is the capacity to separate and refine them.

The problem is at the refinery

  • For copper, lithium, nickel, cobalt, graphite and the rare earths, the top three refining countries held 86 per cent of the market in 2024.
  • China leads the refining of 19 of 20 strategic minerals, and its 2025 export controls on rare earths reached industries from electric vehicles to defence.
  • So midstream processing, and not reserves, decides whether a country is secure.
  • In a supply shock a stockpile of processed material is the most useful, far more than a stockpile of ore.

Magnets: the finished product India cannot yet make

  • A rare earth permanent magnet is what makes an electric vehicle motor small and efficient; wind turbines, electronics and defence use them too.
  • Neodymium iron boron is the strongest permanent magnet in wide use.
  • India's scheme, approved in November 2025, aims at 6,000 tonnes a year of integrated capacity, from rare earth oxide to finished magnet, shared among five firms chosen by global bidding.

Minerals from waste

  • Fly ash, the residue of burning coal, and red mud, the residue of making alumina from bauxite, both carry rare earths.
  • Two pilot plants in Odisha, with processes from the Institute of Minerals and Materials Technology and support from National Aluminium Company (NALCO), will recover them.
  • Recovery from waste adds to supply and reduces the waste itself.

India's own rare earth source

  • Monazite, found in the beach sands of Kerala, Tamil Nadu, Odisha and Andhra Pradesh, holds both rare earths and thorium.
  • Because of the thorium, beach sand minerals are reserved for government companies, and exports go only through IREL (India) Limited.

The way forward

  • Invest in processing and separation, since mining without refining only moves the dependence one step.
  • Build stockpiles of processed material under the National Critical Mineral Mission.
  • Scale up recycling and recovery from waste.
  • Secure overseas supply through partnerships, while building capacity at home.

Prelims facts

  • India's 2023 list has 30 critical minerals.
  • Rare earths are 17 elements, including scandium and yttrium.
  • Monazite yields thorium as well as rare earths; IREL handles it.
  • Red mud comes from bauxite processing; fly ash from burning coal.

Open the lead on its own page

A mineral is called critical when an economy and its armed forces cannot do without it and the supply can be cut, which is a judgement about politics as much as geology. India's list of 2023 names 30, among them lithium, cobalt, nickel, graphite, the rare earths and the platinum group. For almost all of them the cut would come at the refinery rather than the mine: processed material, not raw ore, is what serves a country in a supply shock, so midstream processing rather than reserves decides resource security. The rare earths are the seventeen metals, the fifteen lanthanides with scandium and yttrium, used in magnets, electronics and defence.

What changed

  1. 20 Aug 2026LeadCritical minerals: the refinery problem

UPSC has asked

  • Prelims 2025: the Minerals Security Partnership and India's critical mineral endowment

National Critical Mineral Mission

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Prelims and Mains

The National Critical Mineral Mission, approved in January 2025, is India's umbrella programme for critical mineral security.

  • It covers exploration at home, processing, recovery from waste, acquisition of assets abroad through KABIL, and stockpiling.
  • Stockpiling agreements with partners such as Japan, and access to processing chains abroad, are how it works outside India.

What changed

  1. 2 Jul 2026BriefIndia and Japan agreed to cooperate on strategic stockpiling of critical minerals, covering national and industry stockpiles and emergency response. The Indian Express, 2 Jul 2026: India works on nickel access in Indonesia and on stockpiling with Japan (opens in a new tab)

Background reading: PIB, 11 Sep 2026: Critical Minerals Key to India's Energy Security, Industrial Competitiveness and National Security: Union Minister Dr Jitendra Singh (opens in a new tab) · The Indian Express, 6 Jul 2026: India works on nickel access in Indonesia and on stockpiling with Japan (opens in a new tab)

UPSC has asked

  • Prelims 2026: rare earth elements and the National Critical Mineral Mission

Sintered rare earth permanent magnets

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Prelims and Mains

A rare earth magnet is what shrinks an electric motor enough to fit inside a car, and it is the finished material India is least able to make. A sintered magnet is made by aligning rare earth alloy powder in a magnetic field, pressing it and heating it below melting until the grains fuse. Neodymium iron boron is the strongest permanent magnet in wide use; samarium cobalt is weaker but holds its magnetism at high temperature, so defence and aerospace use it. Electric vehicle motors, wind turbines, electronics and defence all run on them, and the scheme approved on 26 November 2025 funds Indian manufacture. The alternative is an electromagnet, copper coil on an iron core, which large generators have used for a century; in an electric vehicle motor it trades dependence on imported rare earths for losses in efficiency, starting torque and top speed, which is why the cars still need rare earths.

6,000 tonnes a yearIntegrated magnet capacity aimed at in India

5 beneficiariesUp to 1,200 tonnes each, through global bidding

7 yearsTwo to build the plant, five of incentives

The scheme was approved on 26 November 2025; figures from the Press Information Bureau release of 13 August 2026

Background reading: The Hindu, 23 Jul 2026: 'Virtual magnet' claims reveal why EVs need their rare-earths (opens in a new tab)

Critical minerals from industrial waste

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Prelims and Mains

Waste that is already dug up, ground and stacked has had the expensive part of mining done to it. Fly ash, the fine residue of burning coal, and red mud, the alkaline residue of extracting alumina from bauxite, both carry rare earths and other metals, and recovering them supplements mining and cuts the waste burden at once.

See also: Urban mining

Monazite and the beach sands

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Prelims

The sands of India's southern coast carry monazite, the mineral that holds both thorium and rare earths. That double content is why it is handled as a strategic mineral and not a commercial one.

  • Exports of monazite go only through IREL (India) Limited.
  • The monazite threshold has been 0.00 per cent of total heavy minerals since 2019, so every beach sand mineral deposit sits with government companies.

UPSC has asked

  • Prelims 2022: monazite as a source of rare earths, and its thorium

Also filed elsewhere

  • Critical mineral block auctions · on Mining and minerals

    The Centre auctions blocks of critical minerals in tranches under the mining law amended in 2023, offering rare earths, lithium, graphite, vanadium, tungsten and potash among others.

  • District Mineral Foundations · on Mining and minerals

    A District Mineral Foundation (DMF) is a district level body that spends on the welfare of areas and people affected by mining.

  • India's deep sea mining programme · on Ocean, polar and earth science missions

    India's deep sea mining programme explores the seabed for minerals under three International Seabed Authority contracts.

  • Lithium blocks abroad · on Mining and minerals

    Lithium blocks abroad are lithium bearing ground in other countries that India buys into, through KABIL, Khanij Bidesh India Limited.

  • Urban mining · on E-waste, battery and hazardous waste

    Urban mining is recovering metals and critical minerals from electronics at the end of life.