China unreliable, opportunity for India to capture critical minerals market: LOHUM CEO Rajat Verma

With China doubling down on establishing a market monopoly in electric vehicle manufacturing with the impending rare earth magnets and critical minerals crisis, major automakers in the country are worried.

Recently, Anurag Mehrotra, the MD of JSW MG Motor India, asserted that they—the maker of the runaway EV hit, MG Windsor—were only “as impacted or not impacted as any other vehicle maker in the country.”

With that, MG’s India arm joined the likes of indigenous greats like Tata Motors and Mahindra & Mahindra, as well as the India units of Hyundai and Suzuki, who would be on the lookout for how this crisis, which is said to impact rare earth magnets and critical minerals, would affect them.

Rare earth magnets find themselves as essential components in EVs. Moreover, they are also needed in both hybrid and internal combustion engine (ICE) vehicles.

As China imposed heavy restrictions on them, Rajat Verma, CEO and founder of Lohum—India’s largest producer and processor of sustainable critical minerals—spoke to THE WEEK about industry prospects, among other things...

Q: What significant short-term impact do you see in India due to the recent curbs by China?

A: China’s export curbs have increased price volatility and scarcity for lithium, cobalt, and nickel, exposing India’s supply chain vulnerabilities.

India already has the basic technology needed to weather this crisis.

While in the short term, the export curbs will certainly lead to volatility, we should aim to secure our feedstock and develop domestic capacity.

Additionally, this presents an opportunity for India to capture market share globally since China has shown itself to be an unreliable trading partner.

Indian industry is accelerating local capacity growth, with policy support from the National Critical Minerals Mission, Battery Waste Management Rules, and Battery Aadhaar, among other holistic ecosystem development measures.

We advocate for a reduction in GST on scrap and for global free movement of battery recycling feedstock, the latter of which is currently impeded by non-tariff barriers.

The government is fast-tracking incentives for recycling and urban mining to respond to these shocks, and we are scaling up our capacities for Lithium, Cobalt, Nickel, Rare Earths, and Platinum Group Metals.

Q: What is the long-term impact of China’s seeming monopoly over rare earth magnets in India?

A: China’s monopoly poses a major risk to national security, energy security, and economic security. India has been mining REE for 50+ years, and now it is time for it to scale up and flow down the value chain.

Additionally, India needs to develop global linkages to procure feedstock, grow technology partnerships with Japan and the US, and invest in alternate technologies.

Q: How do you think India can achieve sustainability in the critical mineral ecosystem, and what can the industry do?

A: To ensure environmental sustainability, we need sector-wide formalisation, standards, and stringent audit mechanisms.

For economic sustainability, we need to achieve scale in critical mineral production and circularity. This means the development of downstream industries that will generate domestic demand for these materials, along with government support in the form of subsidies and incentives till the industry hits scale and matures.

Q: The Government plays a big part in determining industry policy. What are your expectations from the state and central governments regarding the same?

A: The Government of India has been very proactive, and we at LOHUM are grateful for that. The NCMM is a significant development; its details are still being worked out, and we look forward to them.

Going forward, we invite the formalisation and standardisation of recycling, and welcome the exploration efforts that will get India assets from diverse global sources, mitigating immediate risks. At this crucial time, trade talks and deals with the US and EU should include the movement of critical minerals and mineral-containing waste streams.

Q: Is there a way out of the rare earth magnet crisis?

A: India’s sizable 6.3 per cent share in global reserves of REE awaits utilisation, and there is an urgent need to translate this potential into meaningful production by utilising existing assets and scaling up innovation.

India currently consumes approximately 8,000 to 10,000 tons of permanent magnets annually, with this demand expected to grow over time.

The Indian automobile manufacturing sector alone—employing nearly 2 million people—requires around 8,000 to 10,000 tons of permanent magnets each year. However, this sector is under significant pressure due to the ongoing supply chain constraints with China.

While rare earth oxides are produced domestically, India’s capability to manufacture magnets is still developing—requiring focused innovation and collaboration. Collaborations across industries and borders are accelerating to bridge this critical gap.

Expanding production, refining, and recycling capacity with a long-term sustainable vision is the need of the hour to secure India’s leadership in critical minerals.

Global partnerships and the free movement of critical minerals will significantly aid in supply security.

Lohum is scaling up REE production and forming global JVs to address supply chain risks and build a resilient future.

Q: LOHUM is among India’s largest producers and processors of sustainable critical minerals and among the largest in the world. How did the FY 2024-2025 production and processing numbers stack up?

A: Currently, our rapidly growing production capacity has reached 25000+ Metric Tonnes (equivalent to 5GWh of battery capacity). As of today, 80 to 90 per cent of all Lithium and Cobalt produced in India was produced at LOHUM.

Q: Could you tell us how LOHUM achieved 25,000 tonnes of critical mineral processing in a year? How does the NEETM recycling and extraction technology help here?

A: We have developed our processing lines to be simple; this makes it easy to scale them. A lot of innovation has gone into figuring out the right reagents and process parameters to keep the overall process simple and scalable.

Our process can take in diverse feedstocks, which makes our utilisation rates higher. Further, our focus on eliminating waste helps us get the best possible yields.

Q: LOHUM is also among the largest Lithium-ion battery recyclers—perhaps the biggest in India by market share. Does India need more players in the same space?

A: Our basic philosophy is “A lot of simple things done well”. We maintain a relentless focus on R&D, with continuous iterations for every process and technology.

When we first started, our Lithium recovery rates were less than 19 per cent. They have now reached 90 per cent.LOHUM’s refining costs are one-third to one-fifth of US and EU peers and competitive with best-in-class Chinese refiners.

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