India is eyeing Myanmar’s armed rebel Kachin Independence Army (KIA) as a potential new partner to source heavy rare-earth elements, Reuters reported earlier this month. State-owned Indian Rare Earths Limited (IREL) and the private firm Midwest Advanced Materials have been tasked with assessing ore samples from mines held by KIA in northern Kachin State.
KIA seized rare earth-rich borderlands in 2024 and, to date, has dealt mainly with Chinese buyers. But amid frictions over the group’s advances on junta-held towns and Beijing’s stop-start export curbs on rare earths and magnets, New Delhi appears to be testing whether cooperation with ethnic rebels can provide a strategic alternative.
Even as Indian Prime Minister Narendra Modi and Chinese leader Xi Jinping publicly proclaim warm relations, the importance of rare earths is driving India and China into a state of competition.
Rare earth elements are a group of 17 metals essential for high-performance magnets, batteries, electronics, renewable energy systems, and advanced defense equipment. Among them, dysprosium and terbium are heavy rare earths, which are especially critical because they allow magnets to withstand high temperatures, making them vital for EV motors, wind turbines, and missile systems.
China dominates the global rare earth industry, producing nearly 70 percent of mined supply, holding approximately 90 percent of separation and refining capacity, and accounting for over 90 percent of magnet production. In recent years, stricter environmental regulations have led to a decline in domestic mining in China, but Beijing has offset this by sourcing heavy elements from neighboring Myanmar.
Since the 2021 coup, Myanmar’s rare earth exports to China have surged more than fivefold, reaching approximately $3.6 billion in 2024. For six consecutive years, Myanmar has been China’s top supplier, providing over half of its total rare earth imports by value. Much of this boom came after junta-aligned militias pushed illegal mining in northern Kachin State, where deposits of dysprosium and terbium are concentrated. These operations continued after the KIA took control of the territory. Amid civil war, concerns over environmental destruction and human rights abuses have been sidelined, fueling a lucrative but destructive cross-border trade.
India has its own sizable rare earth reserves, but a limited capacity to exploit them. Most domestic output comes from light rare earths in coastal sands, leaving the country dependent on imports for the heavy elements needed in advanced magnets. Approximately 80 percent of India’s rare earth import value comes from China. When Beijing froze exports of strategic minerals and magnets in April 2025, industries central to India’s growth and security were suddenly put at risk. This vulnerability has driven New Delhi to seek processing partnerships with Japan and South Korea, and to consider the KIA as a potential supplier.
India’s shift to Myanmar should not come as a surprise. The country has long been a theater of China-India competition. Since the 1970s, New Delhi has sought to counter Beijing’s presence through aid, infrastructure development, and military engagement. In 1992, this approach was formalized as the Act East Policy, aimed at deepening ties with Southeast Asia and balancing China’s rise.
Despite raised eyebrows, this would not be India’s first pragmatic engagement with armed actors in Myanmar. Seeing the weakening of the junta’s forces and the advances of ethnic groups in 2024, Indian security agencies coordinated with the ethnic armed organization known as the Arakan Army to secure borders and the Kaladan transport corridor. Engagement with the KIA over rare earths fits into this pattern of transactional relations with militias when state authority falters.
Even if India sources ore from KIA-held pits, the processing know-how, reagents, and capital at many Kachin sites come from Chinese firms. The relationship between the KIA and Beijing is opaque and uneasy, with border closures that have at times cut off both mining inputs and rare earth exports. Yet China continues to hold significant sway over these operations. For New Delhi, this raises the question of whether the KIA can truly deliver an independent supply without Chinese technicians and financiers.
Logistics present another major hurdle. The Kachin deposits lie much closer to China’s Yunnan Province than to India’s Manipur or Nagaland, and the westward routes toward India are rugged and insecure. The old Myitkyina-Assam road is mainly unusable for heavy transport, while the southern route through Sagaing to the Tamu-Moreh crossing in Manipur cuts through zones of fighting. Compared with the short, paved highways into China, moving ore to India would mean a long, risky detour.
Securing ore is only the first step; the more challenging task is turning it into usable inputs. India lacks facilities to process dysprosium and terbium, and neither IREL nor Midwest Advanced Materials currently works with them. Developing separation plants and magnet production lines will require significant capital and years of lead time, even with assistance from Japan or South Korea. Until that infrastructure is in place, Myanmar’s raw ore will not translate into immediate supply security, leaving India vulnerable to delays and cost overruns.
However, even if India resolves the technological bottleneck, another concern remains: environmental and human rights standards. Myanmar’s rare earth boom relies heavily on in-situ leaching, a method associated with severe soil and water contamination, as well as labor abuses documented by watchdog groups. These issues were already raising international alarm in 2022, and they will only sharpen if India begins sourcing directly from conflict zones.
New Delhi’s outreach to the KIA underscores both the risks and the stakes. Rebel-held rare earths could reduce India’s dependence on Beijing, but the mines remain tied to Chinese expertise, insecure supply routes, and environmentally damaging practices. While India may not aim to cut China out entirely, this effort signals the importance it places on improving its control over rare earths. It also signals the strength of China’s global refining monopoly and the lengths to which many governments, even those purportedly reconciled to China, are willing to go to break that monopoly.