Prime Minister Narendra Modi with Chinese Foreign Minister Wang Yi during a meeting, in New Delhi.
| Photo Credit:
PTI
In a major relief for the Indian industry, China has promised to address India’s key concerns related to supply of fertilisers, rare earths and tunnel boring machines, according to government sources.
“Chinese Foreign Minister Wang Yi has assured External Affairs Minister S Jaishankar that China is addressing India’s needs of fertilisers, rare earths and tunnel boring machines,” a government official told businessline.
The important assurances from China to India, delivered in a meeting between Wang and Jaishankar on Monday, come at a time when both countries are facing challenges from the US on the trade and tariffs front.
Modi invited
Wang also met Prime Minister Narendra Modi on Tuesday and handed over an invitation from President Xi Jinping for the SCO Summit being held in Tianjin, according to an MEA statement.
India has been lobbying hard with China for easing of restrictions on export of rare earth elements and magnets to the country as its EV manufacturers have been badly hit due to its shortage. Rare earth elements are crucial for magnets that power the motors in EVs.
“India’s requests for supplies of rare earth made to China were buried in the huge pile of applications that the Chinese Commerce Ministry had collected after imposing restrictions. Requests for appointments with Chinese government officials made by our auto industry were being ignored. Now, hopefully things would change,” another official said.
China is by far the largest producer of rare earth elements in the world. On April 4, 2025, Beijing imposed export restrictions on seven rare earth elements and magnets. Apart from the EV sector, these are also extensively used in the defence, energy and automotive sectors. These restrictions were imposed as a response to increased US tariffs on Chinese products but it also hit other countries, including India. Under the new rules, exporters needed additional licences before being able to export from China.
“India’s EV manufacturers, especially those making two-wheelers, had stopped producing certain models. The shortage of rare earth magnets led to production delays and postponement of launch of new models. It significantly hit the Indian industry,” the source said.
Both the government and the industry are now hopeful that early action will be taken by China in clearing applications for supplies to India.
On fertilizer supply
China’s assurance on supply of fertilizers is also crucial as India has been facing shortages after exports were nearly stopped by Beijing in early 2025. India imports a large portion of speciality fertilizers used for high-value crops like fruits and vegetables from China.
Exports of tunnel boring machines used in India’s infrastructure project were also restricted by China, but now would hopefully resume going by Wang’s promise.
Published on August 19, 2025
