China has dominated Myanmar’s rare earth mines — now India eyes deal to harness country’s critical minerals

China has long dominated the supply chain for Myanmar’s rare earth minerals. Now, India is looking to enter the race for access to the Southeast Asian country’s critical mineral wealth.

India and Myanmar are working to deepen cooperation in the rare earths sector following visits by Indian teams to the country, as New Delhi seeks alternative sources of minerals crucial for electric vehicles, defence systems, aerospace and renewable energy technologies.

Indian Ambassador to Myanmar Abhay Thakur outlined the growing bilateral cooperation at the opening of a mining forum in Mandalay, saying collaboration in the mining sector had gained “significant momentum” over the past two years.

This included visits by two Indian delegations focused on rare earths and critical minerals to Myanmar in December 2024 and February 2026, Thakur said.

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The issue also received high-level attention during an official visit by Myanmar’s junta chief-turned-president Min Aung Hlaing to India in May-June.

“India's need for harnessing critical minerals, coupled with the benefits to Myanmar from sustainable mining, presents solid, win-win, short and long-term opportunities,” Thakur said.

Why Myanmar’s rare earths matter

Myanmar has become a critical source of rare earth minerals for China, particularly heavy rare earth elements extracted in Kachin State near the Chinese border.

A 2025 study by the Institute for Strategy and Policy-Myanmar, based on data from China’s General Administration of Customs, found that Myanmar exported more than 290,000 tonnes of rare earth minerals to China between 2017 and 2024.

That accounted for approximately 74 per cent of China’s total rare earth imports during the period. Myanmar remained China’s largest supplier by volume for eight consecutive years, with its share of Chinese rare earth imports ranging between 60 per cent and 87 per cent annually.

The flow of minerals accelerated after Myanmar’s 2021 military coup. The country exported rare earth minerals worth $3.6 billion to China between 2021 and 2024, accounting for 84 per cent of its total exports during the broader 2017-2024 period.

Exports peaked at $1.4 billion in 2023, according to the study.

The rare earths extracted in Kachin include dysprosium and terbium, two heavy rare earth elements used in high-temperature-resistant permanent magnets.

These magnets are crucial for electric vehicles, wind turbines, aerospace equipment and advanced defence technologies.

India seeks a foothold

The Indian companies attending the Mandalay mining forum included state-owned Indian Rare Earths (IREL), NTPC Mining, Himadri Specialty, Oceanic Sands, PrNd Metal & Magnets and Jai Puri Holdings, Thakur said.

He also mentioned “Midwest from India” as having closely engaged with Myanmar in recent months and years, without specifying the nature of its involvement.

Reuters has previously reported that IREL and private firm Midwest Advanced Materials were among those involved in discussions to explore the collection and transportation of rare earth samples from mines under the control of the Kachin Independence Army (KIA).

The KIA controls key mining hubs in Kachin State, near the Chinese border. India has sought samples from the region to assess the quality and composition of the rare earth deposits.

The talks highlight the complexity of India’s effort to secure access to Myanmar’s critical minerals. Some of the most important mining areas are located in territory controlled by ethnic armed organisations rather than the central government.

India’s interest in Myanmar is part of a broader push to diversify its critical mineral supply chains and build domestic capabilities in rare earth processing and magnet manufacturing.

However, gaining access to raw materials is only one part of the challenge. China currently dominates the processing infrastructure required to turn Myanmar’s mined material into usable rare earth products.

China controls the processing chain

Rare earth mining in Myanmar is deeply integrated with China’s processing ecosystem.

The ISP-Myanmar study said rare earth mining sites in the country produce rare-earth oxide equivalent raw materials, which are then processed in China.

The report said major processing operations are overseen by Chinese state-owned enterprises, including China Northern Rare Earth Group and China Rare Earth Group. Subsidiaries such as Ganzhou Rare Earth Group, China Minmetals Rare Earth Company and Guangdong Rare Earth Group have reportedly been involved in purchasing and importing rare earth minerals from Myanmar.

This gives China a significant advantage over potential competitors.

Even if India succeeds in securing access to Myanmar’s mines, it would still need to develop or secure arrangements for transportation, separation, refining and downstream manufacturing.

The strategic importance of this supply chain has grown as countries seek to reduce their dependence on China for minerals and components used in clean energy, electric mobility, electronics and defence.

Mining boom amid civil war

Myanmar’s rare earth mining industry has expanded rapidly amid the country’s ongoing civil war.

The ISP-Myanmar report found that Myanmar’s rare earth exports to China surged after the 2021 coup. More than 170,000 tonnes were shipped between February 2021 and December 2024, representing nearly 60 per cent of Myanmar’s total exports over the eight-year period. The highest annual export volume was recorded in 2023, when more than 70,000 tonnes were shipped to China.

The report also recorded a sharp expansion in mining sites and collection pits in Kachin State. A total of 371 mining sites and 2,795 rare earth collection pits were developed between 2013 and 2024, with the largest number of new mining sites recorded in 2021.

Control of important mining areas has also shifted during the conflict.

The KIA seized control of the Pangwa region in October 2024. The area had previously been controlled by the New Democratic Army-Kachin, a militia linked to Myanmar’s military establishment.

Following the takeover, mining operations appeared to come under KIA control, although the status of companies and Chinese partners that had previously operated in the region remained unclear.

The report said mining continued at some sites and that some KIA units were reportedly involved in rare earth mining. It also said some Chinese companies were reportedly participating in mining activities in the region.

Environmental and political risks

India’s potential engagement with Myanmar’s rare earth sector also carries significant risks.

The rapid expansion of mining has been accompanied by environmental damage and concerns over the impact of unregulated operations on local communities.

The ISP-Myanmar study documented air and water pollution linked to mining and the disposal of chemical waste. Communities in mining areas reported difficulties accessing clean drinking and household water.

The report also raised questions over the legal status of some mining operations and the extent to which revenues generated from rare earth extraction are formally recorded or contribute to state revenue.

That could make any future arrangement involving India particularly sensitive.

New Delhi would need to navigate not only Myanmar’s military government and its state institutions but also ethnic armed organisations that control some of the country’s most important mineral-producing areas.

A potential shift in the rare earths race

For years, Myanmar’s rare earth mines have fed China’s powerful processing and manufacturing ecosystem.

India’s emerging interest could mark the beginning of an effort to create an alternative supply route.

The two countries have not disclosed details of any formal deal. But the visits by Indian delegations, the involvement of Indian mining and materials companies, and the high-level attention given to the issue indicate that rare earths are becoming an increasingly important part of India-Myanmar economic engagement.

For India, the challenge will be to convert access to Myanmar’s mineral resources into a reliable supply chain while navigating a conflict zone and building the processing capabilities needed to compete with China.

For Myanmar, closer engagement with India could offer an opportunity to diversify its economic partnerships beyond China.

But as the country’s rare earth mines become more strategically important, control over the minerals — and the supply chains built around them — is likely to become an increasingly important part of the wider geopolitical competition over critical resources.