Can India Emerge As Global Alternative To China In Rare Earth Magnet Supply Chain In 2026? - Details

With the global rare earth supply chain at an inflection point, diversification away from China is real, but gradual creating an opportunity for India to establish itself in this vertical, critical to semi conductors, electric vehicles and the smartphones.

Indian logistics companies that embed compliance and operational discipline into their DNA now have a once-in-a-generation opportunity to establish themselves as indispensable partners in the supply chains that power the global transition to electric mobility, renewable energy, and advanced electronics, as per a Amicus Growth Advisors report.

"The companies that adapt early will not only participate in these supply chains—they will help define India's role in the global high-technology and low-carbon economy," it said.

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India possesses genuine rare earth resources and has begun building policy infrastructure through the National Critical Minerals Mission, however, the policy intent and execution are worlds apart.

“This creates an uncomfortable truth: India's role in rare earth supply chains will be determined not by how much we mine, but by how well we move what we have,” according to to the report. 

Overall, India’s rare earth sector is at a nascent but pivotal stage: it has large in-ground potential but very limited output and capabilities so far.

The coming years are likely to see increased exploration (195 REE exploration projects are underway, set to rise to 227 in 2025-26), partnerships with resource-rich countries (India has cooperation agreements with Australia, Mozambique, Malawi, etc. via the Critical Minerals Partnership), and efforts to build domestic processing capacity.

India's Way Forward In Rare Earth Supply Chain

India’s rare earth logistics landscape is still forming defined by low volumes, evolving regulation, and uneven infrastructure. In such an environment, large logistics players wait for stability, leaving SMEs and startups to move first.

"Their agility allows them to profitably handle volatile flows, tolerate ambiguity, and innovate while policy and standards mature," the think tank said.

Early Movers & Execution Enablers

SMEs act as bridges between policy ambition and operational execution. They translate regulation into daily processes, coordinate between miners, recyclers, and ports, and often deliver compliance-ready transport before commercial scale exists.

Startups Driving Recycling Feasibility

In REE recycling, the bottleneck is logistics, not chemistry. Startups address this by designing efficient collection density, aggregation nodes, and movement sequencing that keep transport costs below material value turning technical recycling success into commercial scalability.

Reverse Logistics As A New Market

Recycling introduces low-volume, high-variance cargo needing regulatory reclassification. SMEs and startups are formalising these reverse flows creating demand for short-haul trucking, bonded warehousing, and ICD handling that evolve into standalone REE corridors.

Port-Adjacent and Capability Roles

At ports, SMEs fill gaps left by slow infrastructure projects through micro-capacity storage, flexible documentation handling, and multi-client neutral operations. They are effectively building readiness before scale arrives.

Strategic Implication

For Indian logistics, engaging SMEs and startups now offers early learning on compliance workflows, pricing models, and corridor design assets that will underpin lithium, cobalt, and battery material logistics later.

In short: India’s REE logistics future is being written by smaller players today. They absorb uncertainty, codify processes, and lay the groundwork that larger operators will eventually scale.