India’s Rare Earth Paradox: Vast Reserves but Negligible Global Production

India’s Standing in Global Rare Earth Reserves

India holds the third-largest reserves of rare earth elements (REEs) in the world, yet its role in global production remains disproportionately small. According to a recent report by Amicus Growth , India has approximately 6.9 million tonnes of rare earth oxide reserves , trailing only China (44 million tonnes) and Brazil (around 21 million tonnes) . With nearly 6–7 per cent of global reserves , India appears well-positioned on paper to emerge as a strategic supplier.

Marginal Production Levels

Despite this resource base, India’s actual output tells a different story. In 2024 , India produced just 2,900 tonnes of rare earth elements, ranking seventh globally . By contrast, China produced about 270,000 tonnes , followed by the United States (45,000 tonnes) and Myanmar (31,000 tonnes) . Australia, Thailand and Nigeria each reported production near 13,000 tonnes . India’s contribution accounted for less than one per cent of global supply , exposing a stark reserve–production mismatch.

Geological and Regulatory Bottlenecks

A major challenge lies in the geological nature of India’s deposits. Most REEs are embedded in monazite-rich coastal sands , which also contain thorium , a radioactive mineral. This brings rare earth mining under stringent regulatory oversight. Historically, extraction was tightly controlled by Indian Rare Earths Limited , where REEs were treated as by-products rather than strategic resources.

Processing Deficit and Strategic Risks

India’s most serious weakness lies beyond mining — in processing and refining . China dominates nearly 90 per cent of global refining capacity , especially for heavy rare earths. India lacks integrated value chains and large-scale refining facilities, limiting its role in global supply networks. The report concludes that India’s rare earth challenge is rooted not in scarcity, but in policy inertia, weak execution, and insufficient processing infrastructure .

Important Facts for Exams

• India holds ~6–7% of global rare earth oxide reserves

• Monazite sands are India’s main REE source and contain thorium

• China dominates ~90% of global REE refining

• Rare earths are vital for EVs, defence, and renewable energy