China on Thursday indicated a potential entry point for talks with India over its new export curbs on rare earth elements, saying it was prepared to enhance dialogue and cooperation with other countries to ensure the stability of global industrial supply chains.
Beijing's export restrictions on key metals have recently halted production in major industries like automobile manufacturing and semiconductor development in several countries, including India.
Commenting on the issue, Chinese Foreign Ministry spokesperson Lin Jian said that China welcomes cooperation, though he underlined that specific issues should be dealt with by the respective government departments.
At the same time, the Ministry of External Affairs (MEA) confirmed in New Delhi that it has been in touch with Chinese counterparts to achieve predictability in trade-related supply chains. This diplomacy comes in line with India's desire to achieve consistency according to international trade standards.
We have spoken to the Chinese side, the Chinese Ministry of Commerce and General Administration of Customs in early April, as you would know, had announced the decision to impose export controls on some rare earth-related items," MEA spokesperson Randhir Jaiswal told a press briefing on Thursday.
He also added, "We are in contact with the Chinese side, both here in Delhi as also in Beijing, to bring predictability in supply chain for trade, as per international practices."
On June 16, Indian Ambassador to China Pradeep Kumar Rawat met with Chinese Vice Minister of Foreign Affairs Sun Weidong. As per an Indian foreign ministry statement, the two sides discussed a number of bilateral issues, including mutual concerns.
Within India, there is increasing concern among industry players regarding possible repercussions from rare earth shortages, particularly against the automobile sector and allied industries.
Following months of restrictions on the export of rare earths—commodities for which China has extensive worldwide influence—Beijing has now been said to have begun issuing selective export permits, especially to the United States. This comes following trade talks conducted in London that were meant to de-escalate tensions between the two economic powers.
Rare earths is a term used to describe a collection of 17 chemically related elements that are essential in the production of electronics, magnets, batteries, and advanced defense systems. Although these elements are present in various parts of the world, their extraction is costly and environmentally unfriendly and usually leads to high pollution levels.
As per statistics from the International Energy Agency (IEA), China is accountable for 61% of global rare earth mining production but controls 92% of world processing and refining capacity.
US President Donald Trump made the announcement on Wednesday that a trade deal with China had been struck after two days of talks in London. His statement is a possible turning point in the long-running trade dispute between the two nations.
Although China has begun negotiations with both the US and the European Union to resolve issues of rare earth availability, it has not responded in writing to India's invitation for similar consultations.
Meanwhile, an Indian delegation of the automobile industry is set to visit China in order to fast-track the purchase of rare earth magnets—vital parts for several industries—sources privy to the issue in New Delhi said.
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