According to Reuters, Japan is in talks with India to jointly explore rare earth deposits in the desert state of Rajasthan, as Tokyo seeks to reduce reliance on China for supplies critical to magnet manufacturing. The report, based on two sources directly involved in the decision-making process, marks a notable development in efforts by both nations to reshape global critical mineral supply chains.

The talks are anchored in a recent geological find of considerable scale. India's Mines Minister G. Kishan Reddy announced last month the identification of three hard rock rare earth deposits in Rajasthan and Gujarat, containing an estimated 1.29 million metric tons of rare earth oxides — findings he said could significantly boost India's mineral security. The deposits are located in Rajasthan, a western state known for its arid terrain, and represent one of the more substantial rare earth discoveries in South Asia in recent years.

The Proposed Framework

Following a preliminary pact on critical minerals that Japan and India signed last year, Tokyo has expressed interest in the Rajasthan deposits and plans to send experts to the site, according to the sources, who declined to be named as the deliberations were not public. No timeline for the expert visit has yet been confirmed.

The structure of any eventual agreement is expected to follow a technology-for-supply model. The partnership would involve Japan supplying essential extraction technology and financial investment, with Japan seeking in return a guaranteed, consistent supply of rare earths to be transported to Japan. The technical rationale for this arrangement is straightforward: hard rock rare earth deposits require specialised extraction techniques which India currently does not have at scale, making Japan's technological expertise a key component of any development plan.

Reuters received a partial denial from the Japanese side. Japan is examining mining projects worldwide to diversify mineral supplies, including rare earths, Naoki Kobayashi, deputy director at Japan's Ministry of Economy, Trade and Industry (METI), told Reuters. However, Kobayashi denied any discussion on specific corporate partnerships or technology provision in Rajasthan. India's Ministry of Mines and the Japanese embassy in New Delhi did not respond to Reuters' requests for comment.

Strategic Context: Why Rare Earths Matter

The industrial stakes are considerable. Rare earths are essential for permanent magnets used in electric vehicle motors, wind turbines, fighter jets and drones — critical for India, the world's fastest-growing major economy. Both nations have identified supply security for these materials as a priority, and the alignment of their interests underpins the current discussions. Like Japan, India wants to cut dependence on Chinese imports by developing industrial-scale facilities to process rare earth elements to high purity levels, with Japan potentially offering the necessary technology.

The China Factor

The talks unfold against a backdrop of deteriorating Japan-China relations and tightening Chinese export policy. Last week, China banned the export of certain dual-use items to 20 Japanese entities that it claims supply Japan's military, effectively restricting Japanese companies' access to seven rare earth elements and other critical minerals currently on China's dual-use control list. That move has added urgency to Tokyo's diversification efforts and is widely seen as having accelerated the India discussions.

For India, the collaboration aligns with its strategy to position itself as an alternative supply hub in the global critical minerals market. For Japan, it represents a calculated step toward insulating key industries from geopolitical risk.

Broader Mineral Cooperation

Reuters also reported that the scope of Japan-India cooperation may extend well beyond Rajasthan's rare earth deposits. Japan is also exploring collaboration with Indian companies to search for lithium, copper and cobalt in Africa, as part of a broader effort to secure diversified and stable mineral supply chains. This suggests the two governments are building a wider bilateral framework for critical minerals, rather than pursuing a single project-by-project approach.

Whether formal agreements follow the current talks remains to be seen. The sources cited by Reuters were clear that deliberations are ongoing and have not yet been made public, and significant details — including corporate structures, investment volumes, and timelines — remain unresolved.