A memorandum of understanding has been signed between Japan and India to promote the production of rare earth minerals in a joint effort. The recent move will help to reduce the reliance for both countries on China which controls most of the world’s supply.
The memorandum was signed on Friday November 16,2012, with the Japanese and Indian governments agreeing to support a joint project between the Japanese trading house Toyota Tsushu Corp and an Indian state run company. From spring 2013, Japan is expected to begin the annual import of 4,100 tons of rare earth minerals from India. This will meet more than 10% of the demand in Asia’s second largest economy.
Rare earth elements (REEs) are used to make a wide range of high-tech products, which include powerful magnets, batteries, iPods, lasers, LED lights, electric cars, missiles and wind turbines.
Most of the supply of Asia’s REEs come from China, but in recent times Beijing has cut down on its exports citing that it is making a move to protect its environment by conserving its supplies. On the other hand, Japan along with the European Union and the United States says that China is unfairly benefiting from its own industries by restricting exports. Companies have also claimed that China is trying to diversify the source of REEs.