According to Bajaj Auto, if China does not resume shipments of rare earth magnets, India's manufacturing of electric vehicles will suffer as early as July. Any further delays in acquiring the essential component for electric cars will significantly affect the production of the Indian electric vehicle sector, the domestic two-wheeler manufacturer that now manufactures the electric scooter Chetak has warned.

According to Reuters, a senior Bajaj Auto official claimed that if the supply of rare earth magnets from China is not secured by July 2025, it may have a significant impact on the manufacture of electric vehicles. Based on the representations made by Bajaj Auto's suppliers, Executive Director Rakesh Sharma informed analysts in an earnings call that the business is hopeful that exporters from China will be granted shipping clearances in the next weeks. According to reports, he stated, "We are hoping that in the coming weeks, exporters from China will obtain permission to ship based on the representations made by our vendors."

Since April 4, Indian automobile industry organizations have petitioned the Indian government for help in gaining access to the rare earth magnets that are currently stored in Chinese ports, and Sharma's statement comes at that moment.

The rare earth magnets used in automobiles, clean energy, and household appliances are currently processed in China, where over 90% of the world's processing capacity is located. In April, the nation established limitations mandating businesses to get import licenses from Beijing.

The potential impact of China's export restrictions on rare earth magnets, which might halt India's automotive industry, particularly the manufacture of electric vehicles, was first publicly acknowledged in Sharma's remarks. Electric cars are powered by electric motors that use rare earth magnets. These unusual magnets made of rare earth are also found in essential parts of automobiles, such as audio speakers and power windows, which are common in conventional automobiles.

Sharma called the present state of affairs a dark cloud on the horizon and noted that, despite India's establishment of a procedure for end-use declaration for civilian users, China has not yet finished this process.

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