What Happened
- Japan and India are in active discussions for a bilateral cooperation framework on rare earth mineral exploration, with both governments seeking to reduce strategic dependence on China-controlled supply chains
- The talks build on a Memorandum of Cooperation signed between India's Ministry of Mines and Japan's Ministry of Economy, Trade and Industry (METI), and expand on existing critical minerals cooperation under the India-Japan Special Strategic and Global Partnership
- Japan is already active in India's rare earth sector through Toyota Tsusho's joint venture with Indian Rare Earths Limited (IREL) in Andhra Pradesh, which processes rare earth oxides for export to Japan
- The cooperation is expected to cover exploration, mining, and processing of rare earth elements (REEs) in India, leveraging India's significant but underutilised reserves
- This initiative aligns with India's National Critical Mineral Mission (NCMM), launched in early 2025, which targets domestic exploration and overseas asset acquisition across 30 critical minerals
Static Topic Bridges
Rare Earth Elements: Strategic Importance and China's Dominance
Rare earth elements (REEs) are a group of 17 metallic elements — including lanthanum, cerium, neodymium, dysprosium, and yttrium — that are critical inputs for electric vehicles, wind turbines, consumer electronics, defence systems (missile guidance, radar), and advanced manufacturing. Despite the name, most REEs are not geologically rare but are economically concentrated due to China's dominance in mining and processing.
- China controls ~60% of global REE production and ~90% of global REE processing capacity
- China holds the world's largest REE reserves: ~44 million metric tonnes REO equivalent (~nearly half of global total)
- China imposed export controls on several critical minerals (gallium, germanium, and REE-related items) in 2023–2024, raising alarm in Japan, the EU, and the US
- India holds ~8% of global REE reserves (approximately 6.9 million tonnes as estimated by the Atomic Minerals Directorate) but contributes less than 1% of global REE mining
- Key REE-bearing minerals in India: Monazite (coastal placer deposits in Kerala, Tamil Nadu, Andhra Pradesh, Odisha) — contains thorium alongside REEs, hence regulated under the Atomic Energy Act
- Japan is among the most REE-dependent major economies, importing nearly 60% of its REE from China in recent years
Connection to this news: The Japan-India exploration talks are a direct response to China's REE dominance; both countries see each other as complementary — India has reserves and mineral processing capacity potential, while Japan has technology, capital, and urgent strategic need.
India's National Critical Mineral Mission (NCMM) and Mineral Diplomacy
India's National Critical Mineral Mission (NCMM), approved by the Cabinet in early 2025, is a ₹16,300-crore programme targeting end-to-end development of domestic and overseas critical mineral supply chains. It identifies 30 critical minerals including REEs, lithium, cobalt, nickel, graphite, titanium, and vanadium.
- NCMM outlay: ₹16,300 crore (FY25–31) + ₹18,000 crore expected investments
- Domestic exploration targets: Geological Survey of India (GSI) to execute ~1,200 exploration projects
- Overseas acquisitions: PSU-led (26 mines) and private (24 mines) targets
- India's import dependence: 90% for REEs; 80% for lithium and cobalt; 85%+ for nickel
- China's share of India's critical mineral imports has risen dramatically: lithium imports from China up 921%, nickel up 137% in 2024
- Key implementing agencies: Ministry of Mines, KABIL (Khanij Bidesh India Limited — PSU for overseas mineral assets), GSI
- KABIL has signed MoUs with Australia, Argentina, Chile for lithium and cobalt; Japan partnership adds REE focus
Connection to this news: The Japan exploration talks represent a key pillar of India's minerals diplomacy strategy — securing supply through bilateral partnerships alongside domestic exploration, rather than relying on the open market dominated by China.
India-Japan Special Strategic and Global Partnership
India and Japan elevated their relationship to a "Special Strategic and Global Partnership" in 2014 under PM Modi and PM Abe. The partnership has expanded across infrastructure (Japan's Official Development Assistance to India — the largest bilateral ODA programme), defence, digital technology, clean energy, and now critical minerals.
- Bilateral trade: ~$20 billion (FY24-25); Japan is one of India's top ODA partners
- Japan-India CEPA (Comprehensive Economic Partnership Agreement) in force since 2011
- Japan's ODA to India: Largest in the world by volume — funding metro rail projects (Delhi, Mumbai, Chennai), Dedicated Freight Corridors, high-speed rail (Mumbai-Ahmedabad Shinkansen), and the North-East connectivity projects
- Free and Open Indo-Pacific (FOIP): Both India and Japan are key architects of this geopolitical vision emphasising rules-based maritime order — rare earth cooperation is part of this geoeconomic dimension
- 2023: Inaugural India-Japan Economic Security Dialogue — emphasised critical minerals, semiconductors, and supply chain resilience
- Quad (Quadrilateral Security Dialogue): India, US, Japan, Australia — critical mineral supply chain cooperation is a key Quad deliverable
Connection to this news: The rare earth exploration talks fit squarely within the broadening India-Japan strategic partnership — moving from infrastructure and defence into supply chain resilience as the new frontier of economic security cooperation.
Key Facts & Data
- China's REE processing share: ~90% of global capacity
- China's REE production share: ~60% of global production
- India's REE reserves: ~6.9 million tonnes (~8% of global reserves)
- India's REE mining share: <1% of global production
- NCMM budget: ₹16,300 crore (FY25–31)
- India's REE import dependence: ~90%
- Toyota Tsusho-IREL JV in Andhra Pradesh: Processes thousands of tonnes of REE oxides annually
- India-Japan CEPA: In force since 2011
- Inaugural India-Japan Economic Security Dialogue: November 2024
- Quad critical minerals initiative: Mapping supply chains, targeting diversification from China
- China's 2023–24 export controls: Gallium, germanium, graphite, and REE-related compounds
- India's monazite coastal placer deposits regulated under Atomic Energy Act (REEs co-located with thorium)