(source : ANI) ( Photo Credit : ani)
Vivek Vikram Singh, the Managing Director and Group CEO of Sona Comstar, is calling on the Indian government to step in and chat with China about easing export restrictions on rare earth metals. These metals are crucial for the auto component industry, and their shortage is causing big headaches for companies like his.
Speaking to on the sidelines of the Automotive Component Manufacturers Association’s annual event in New Delhi, Singh stressed the need for quick action. “We need solutions. The government should talk to the Chinese side and lift these rare earth export controls,” he said. He added that temporary fixes, like using rare-earth-free magnets, aren’t cutting it. “This affects us and our customers. We’re operating with constraints right now, and we hope to run smoothly soon.”
The company already felt the pinch, losing about three weeks of production in the last quarter due to the rare earth shortage. While Sona Comstar has switched to alternatives, Singh pointed out their downsides. “In August, we hit 95% production levels using heavy, rare-earth-free magnets. They’re okay for two- and three-wheelers, but not fully efficient on cost and performance for heavy-duty motors in cars and buses—it’s next to impossible,” he explained.
China’s move in early April to tighten export controls on rare earth items has sparked a global supply crunch, hitting India hard too. With China dominating over 90% of the world’s rare earth processing and magnet production, industries everywhere are facing supply chain vulnerabilities in critical sectors like automotive components.
India isn’t sitting idle. The country is working to diversify its rare earth supply through imports, boosting domestic mining, and building international partnerships. The government is pouring money into research and development to ramp up local refining and processing. Plus, diplomatic efforts are underway to lock in stable, affordable access to these vital materials, with cooperation from like-minded nations. Recently, the central government allocated Rs 1,345 crore to boost rare earth magnets production right here in India.
On a brighter note, Singh praised the latest GST rate cuts as a major win for the auto sector. “These GST reductions are a real boon for the industry—Modi ji has brought Diwali early this year,” he said with a smile. If the cuts fully reach consumers, demand could jump 10-15%, he predicted. “Growth is definite. It’s a positive and bold step.”
As for U.S. tariffs, Singh doesn’t see them as a huge threat. “Our sector is less affected. Any expected export losses to the US can be offset by these GST reforms,” he noted.
Looking ahead, Singh highlighted the need for stronger trade ties with Europe. Negotiations for an India-EU Free Trade Agreement (FTA) are progressing, with a deal possibly wrapping up later this year. “From India’s view, the European FTA is very important. The EU auto market might be smaller than the US in size, but it’s crucial in value. It’s a big opportunity we can’t miss,” he said.
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