India auto sector seeks govt help as magnet imports stall

India's auto sector continues to face supply-chain pressure as rare earth magnet shipments from China remain blocked, despite July discussions in which Beijing signaled potential easing. No shipments have been allowed so far, and imports stay stuck. Industry players have approached the ministries of heavy industries, commerce and industry, and external affairs to seek clarity and a way forward, while urging SIAM and Acma to press the matter with the government and through diplomatic channels with China.

Suppliers in China await formal approvals to resume shipments, leaving Indian manufacturers uncertain. An OEM executive noted that there has been no ground movement despite the apparent indications, and that clearance remains pending.

China halted shipments on April 4 citing regulatory reasons, disrupting the supply chain for autos. In response, some OEMs are sending magnet-related sub-assemblies to China for magnet integration before re-import, a workaround that raises costs and slows production.

Rare earth magnets are a critical input for vehicles, especially in electric mobility. Conventional cars use about 100 grams of magnets, EVs can require up to 3 kilograms, and electric buses may need 7 to 30 kilograms, underscoring the need for steady supply.

ACMA president Shradha Suri Marwah says the industry is evaluating long-term options such as ferrite magnets, lighter rare earth substitutes, and magnet-less designs, but near-term replacements are not ready. The government has announced a rare earth magnet manufacturing program with an outlay above Rs 5,000 crore to build local capacity around 6,000 metric tonnes.

The sector is urging faster resolution to avoid bottlenecks as the EV transition accelerates.