Russia makes moves to challenge Chinese domination Rare Earth Minera

Moscow: Russia has started moves to challenge the Chinese hegemony in the Rare Earth Minerals, a critical input for manufacturing, in the defence and technology sectors. Alexei Besprozvannykh, Russia’s deputy industry and trade minister, said that Russia would be investing nearly $1.5 billion, in the next few months, in this sector. China has more than 35% of the Rare Earth Mineral deposits and China accounts for 80% of the total market for Rare Earth Minerals. Although Russia is said to have nearly 10% of the Rare Earth Mineral deposits, the Russian share in the market is a meagre 1.5%. Against this background, the indications of investment, given by Russia, become significant.

Rare Earth Minerals used in the manufacture of fighter jets, missiles, smartphones, computers and electric cars, is a group of 17 elements. These include ores like Cerium, Neodymium, Samarium, Lanthanum, Gadolinium and China, the United States, Japan and Europe consume the maximum quantities of these minerals. A few years ago, China had delivered a jolt to Japan, by suspending the export of Rare Earth Minerals, after tension was created between the two countries. Fears had been expressed that China will stop the supply of Rare Earth Minerals, even during the trade war with the United States, going on, since the last two years. As of today, the United States is importing 80% of its Rare Earth Minerals requirements from China.

Last year, in June, the US defence department submitted a report to the US Congress. The report suggested that additional funding was required to ensure that the United States does not face a shortage of these minerals and said that all the concerned companies, be instructed to stock sufficient emergency stocks of these minerals. At the same time, the report also instructed that options other than China, should be explored and expeditious moves should be made to fulfil the demand. Thereafter, the United States announced the ‘Rare Earth Initiative’ and declared that nine countries, including Brazil and Australia, had consented to join the initiative. The US proposal did not include Russia.

Against this background, Russian moves to challenge Chinese domination, become important. As per the information given by the Russian Minister, Alexei Besprozvannykh, Russia will be investing $1.5 billion in 11 different projects, in the country. The Russian Minister also indicated that the proposal is open for foreign companies. Target has been set, to take the Russian share, in the global Rate Earth Minerals market to 10%, through the medium of this investment. The Russian Minister claimed that Russia would start exporting these minerals by 2026.

Russia and China are allies and both the countries have joined hands, to form a front on the international level. Is has been observed that the cooperation in many sectors like fuel, space and currency transactions, is becoming stronger between the two countries. But since the last few months, differences over various issues, are also surfacing and international analysts are indicating that Russia is unhappy with China. In this situation, Russia making an additional investment, in the Chinese domination sector, becomes noteworthy.