In this exclusive interview, Shri Rajnish A. Khale highlights that India holds a strong position in rare earth oxide production but lacks a well-developed midstream value chain. While China continues to dominate globally, India is gradually advancing through policy support and strategic investments. Growing demand from EVs, clean energy and defence sectors is expected to drive progress, though supply chain gaps and resource challenges remain key hurdles. 

Shri Rajnish Arvind Khale joined the Board of IREL (India) Limited as Director (Marketing) with effect from 16th June 2023. He is a Gold Medallist in Textile Engineering from Maharaja Sayajirao University, Vadodara, Gujarat. He has also done a Master's in Business Administration in Marketing from the Faculty of Management Studies, Maharaja Sayajirao University, Vadodara, Gujarat. He is an associate member of the Institute of Cost Management Accountants of India. 

After a brief stint with textile major - Arvind Group and in consultancy at Ahmedabad, he joined IREL (India) Limited in June 1993. During his over 30 years tenure at IREL, he has handled Sales & Marketing as well as Strategy & Business Development functions of the company. 

Prior to appointment as Director (Marketing), IREL he handled Sales & Marketing of the entire portfolio of IREL's products in the capacity of Chief General Manager (Marketing). 

Shri R.A. Khale brings with him rich & diverse experience in the field of Marketing & Sales of a wide spectrum of Heavy Minerals and Rare Earths Compounds.

AL Circle: From your perspective, where does India currently stand in the global rare earth value chain, and what is the most critical gap that still needs to be bridged?

Rajnish Khale: India has been a frontrunner in the field of Rare Earths with IREL producing and supplying rare earths since 70’s. IREL has the capability to produce separated individual RE oxides. The value chain beyond the oxides is absent, while there is an end-user industry. For example, REPM, Catalysts, FCC, polishing powders, misch metals (alloys of cerium, lanthanum, and other rare earth metals) midstream supply chain is absent. 

AL Circle: Do you believe India can realistically position itself as a credible alternative to China in rare earth supplies, or will it play a more complementary role in the near to medium term?

Rajnish Khale: China controls about 90 per cent of the world market and has resources that are rich in RE content by 100 times as compared to India. Furthermore, Indian resources are associated with radioactivity, which makes processing further costlier. Despite this, IREL is able to supply various individual RE oxides at competitive rates that are pari passu with the Chinese domestic prices. 

The Chinese industry is a mature one, from mining to the end of the value chain products. India has only recently initiated the process of bridging the value chain gap, with the Government of India taking a proactive role. I am confident that in the next 3 to 5 years we will see visible progress towards meeting our requirements of the RE end products, especially REPM.

AL Circle: How critical are rare earths, in your view, to India's ambitions in energy transition, electric mobility, advanced manufacturing, and strategic sectors such as defence? Is India moving fast enough to align rare earth availability with downstream demand from these sectors?

Rajnish Khale: Rare Earths act like vitamins. They enhance the performance of the end products multi-fold when added in small proportions. The powerful REPMs, which form the backbone for e-mobility, wind energy, robotics, and other industrial applications, are about 50 times stronger than ordinary Ferrite magnets. Rare Earths are an integral part of Hi-Tech defence equipment. Hence, they are critical and strategic in nature.

While IREL has set in motion plans for expansion that will meet the demand for rare earths especially the magnetic rare earths up to 2032, for meeting the increasing future requirements, the conventional resources will have to be complimented by resources from other sources - Rock and other deposits as well as through imports of raw materials especially the heavy rare earth bearing minerals like ion absorption clay.

AL Circle: How would you assess the maturity of domestic demand for rare earths compared with global markets, and where do you see the strongest growth potential emerging?

Rajnish Khale: There is market for end of the value chain products like RE permanent magnets for EV, windmills, etc., auto catalysts for controlling emissions from ICE automobiles, Fluid Cracking Catalyst - required for cracking the crude oil into different fractions and there are industries that produce magnets, auto catalyst in India. However, there is gap in the value chain due to absence of mid-stream industry.

Of these applications, the strongest growth driver will be RE permanent magnets both in terms of volume and value.

AL Circle: In your opinion, do current pricing mechanisms adequately reflect the strategic importance of rare earths, or are they still treated largely as conventional commodities?

Rajnish Khale: Yes, the pricing is market-driven based on demand-supply dynamics. However, to negate the low prices of end products like magnets set by the dominant country in this field that act as an entry barrier, the Government of India has come out with an incentive scheme for the indigenous production of magnets. But, in the long run, as done by Japan, the end-users, like car manufacturers, should patronise the local producers of magnets, notwithstanding the availability of imported products at a lower cost. This would insulate them and the country against supply chain disruptions as seen in April 2025 and then October 2025.

AL Circle: Looking closely, what single policy or regulatory intervention do you think would have the most immediate and meaningful impact on strengthening India's rare earth ecosystem?

Rajnish Khale: Like China since the latter half of the 80s and now, nations like the USA, EU, Australia, the rare earth ecosystem should be considered as strategic and policies like infusing capital-capex support, OPEX incentive, buy-back arrangements should be implemented. The Government of India has already initiated steps in this direction by notifying an incentivisation scheme for indigenous production of Nd-Fe-B magnets which will give OPEX and CAPEX incentives.

AL Circle: ESG considerations such as responsible mining and traceable supply chains are major concerns in present times. How significant do you expect them to become in rare earth procurement decisions globally?

Rajnish Khale: China began their stranglehold on the RE value chain by having slack environmental regulations. After securing their position in the world market, they have consolidated the rare earth industry with few operators and brought in stringent environmental regulations. Globally, in the underdeveloped countries that are endowed with critical minerals, the minerals are exploited with lax ESG norms in contrast to the end-use applications of clean and green energy for which they are extracted. However, with greater thrust by industries on the participants in the value chain being ESG compliant, there would be changes for the better.

AL Circle: Could you please share your insight on the role that a public enterprise like IREL is playing in de-risking supply chains and supporting private-sector participation across the rare earth value chain?

Rajnish Khale: Despite a long six stage process involving lean grade of rare earths ore that has radioactivity attached to it, IREL has been successful in producing high-purity individual rare earth oxides that are globally accepted. Also, despite the higher cost of production, IREL supplies these materials at prices that are pari passu with the prices at which these are available to indigenous downstream players in the largest supplying country. IREL has also embarked upon capacity expansions with four green field projects either on its own or in JV with state government companies in the state of Odisha and TN. Further, resources in AP are also being targeted. Thus, IREL is already keyed in to meet the increasing requirement of the industry once these projects fructify.

To catalyse RE value chains in India, IREL has set up Rare Earth and Titanium Theme Park (RETTP) at Bhopal under the aegis of Department of Atomic Energy, where lab scale technologies developed by BARC are upscaled to mini plant scale. These technologies are available to the industry for upscaling.

AL Circle: From the perspective of future strategic industries, how should India prioritise its exploration efforts among critical battery, rare earth and industrial mineral categories?

Rajnish Khale: From experience, it is seen that regulatory clearances involving multiple State & Central government authorities extend the timelines for execution of mining projects.  These clearances need to be done in a time-bound manner so that the projects remain economically viable and are executed in timely manner to meet the increasing demand for these materials by the industry.

Along with that, wherever required, looking at the strategic importance of these materials, various stakeholders, that would include the industry, academia, government, etc., should also pitch in with their respective contributions so that the entire ecosystem gets developed within the country at the earliest.

At present, Government of India is totally keyed into ironing out these aspects and, the precursor is the National Critical Mineral Mission (NCMM) and other initiatives undertaken through Ministry of Mines and other Ministries.

For example, they have removed duties on all the critical minerals, the Ministry of Mines doing auctioning of the various mines associated with critical minerals in a time-bound manner, etc. This process will get further refined, and I'm confident that, India will rise to the occasion and a well-defined ecosystem will be in place.

It is pertinent to note that China's Per Capita Income in 1988, was lower than that of India’s. Now it is about six times that of India. The answer to this dichotomy lies in the three-decade head start by China realising the strategic importance of critical minerals like rare earths and harnessing the same from mines to end products that include acquiring critical minerals assets abroad.

The Government of India & State Governments are making efforts for developing indigenous ecosystem.  For acquiring assets in foreign countries like Argentina, Australia, etc., the Govt. of India has incorporated M/s. KABIL.  On the rare earth front, IREL is already producing high purity individual RE compounds. The present resources need to be supplemented by identifying & developing other inland deposits as well as acquisition from abroad – especially heavy rare earths.

Recently in the Budget 2026-27, the Government of India has announced the Dedicated Rare Earth Corridors encompassing four states viz. Kerala, Tamil Nadu, Odisha & Andhra Pradesh for facilitating the rare earth ecosystem in the country.

I am confident that with concerted efforts by all stakeholders, India will have a well-developed infrastructure which will meet the end user requirements both industrial & strategic for end-products obtained from critical minerals.

In near future, you will see a marked change in the whole ecosystem with respect to these critical minerals.