Mineral Diplomacy: How the U.S., China, and India Are Competing for Control of Critical Resources

In the evolving landscape of global geopolitics, control over critical minerals has emerged as a pivotal factor influencing international relations and economic strategies. The United States, China, and India are at the forefront of this “mineral diplomacy,” each maneuvering to secure access to essential resources that underpin modern technologies and national security.

China’s Strategic Dominance

China has long held a dominant position in the critical minerals sector, accounting for approximately 60% of global rare earth production and over 90% of processing capacity. This dominance has enabled China to exert significant influence over global supply chains, particularly in industries such as electric vehicles (EVs), renewable energy, and defense technologies.

In recent developments, China has tightened control over the export of strategic minerals. On May 12, 2025, the Chinese government announced plans to enhance oversight of the entire export supply chain for strategic minerals, aiming to prevent illegal exports and ensure national security. This move follows earlier restrictions imposed in 2023 on resources vital to sectors like semiconductor manufacturing and energy.

Furthermore, China has proposed additional export restrictions on technologies used in manufacturing battery components and processing critical minerals like lithium and gallium. These measures are seen as efforts to maintain China’s market share in lithium processing, crucial for EV batteries, and could pose challenges for Western companies reliant on Chinese technology.

U.S. Initiatives for Supply Chain Resilience

Recognizing the strategic vulnerability posed by reliance on Chinese critical minerals, the United States has undertaken several initiatives to bolster domestic production and diversify supply sources. The U.S. Department of Defense has invested $35 million into MP Materials to spur domestic rare earth production, aiming to reduce dependence on imports.

Additionally, the U.S. has imposed a 25% tariff on rare earth magnets from China, set to take effect in 2026. This marks the first time that critical minerals, including rare earth magnets, have been specifically included in tariffs, reflecting the urgency to develop alternative supply chains.

At a recent Axios event in Washington, experts emphasized the importance of securing more critical minerals to enhance U.S. competitiveness against China. Gracelin Baskaran of the Center for Strategic and International Studies highlighted that while the U.S. has some reserves, there are substantial shortages in others, necessitating strategic partnerships and investments.

India’s Strategic Partnerships and Domestic Initiatives

India has emerged as a proactive player in the realm of critical minerals, seeking to secure resources essential for its burgeoning technology and manufacturing sectors. In January 2025, the Indian government approved the National Critical Mineral Mission (NCMM), aimed at encouraging domestic public sector units and private companies to acquire critical mineral assets abroad and enhance trade with resource-rich countries.

India has also proposed a critical minerals partnership agreement with the United States, building upon a previously signed memorandum of understanding. This proposed agreement aims to secure benefits for Indian companies in sectors like EVs in the American market and could serve as a precursor to a potential free trade agreement.

Furthermore, India has joined the U.S.-led Minerals Security Partnership (MSP), a coalition of 14 countries and the European Union committed to securing stable supplies of critical minerals. This alliance underscores India’s commitment to diversifying supply chains and reducing dependence on any single country.

Global Implications and the Road Ahead

The strategic maneuvers by China, the U.S., and India in the critical minerals sector have far-reaching implications for global supply chains, technological advancement, and geopolitical dynamics. As countries vie for control over these essential resources, collaborations and alliances are becoming increasingly important.

For instance, India and the U.S. are exploring joint ventures in third countries to secure supply chains, with New Delhi keen to ramp up engagement through pacts in the critical minerals sphere. Such collaborations aim to counter China’s dominance and ensure a diversified and resilient global supply chain.