Auto stocks in India, including Eicher Motors, Maruti Suzuki, and TVS Motor Company, rose up to 2% on June 18, 2025, following reports that India is exploring rare-earth magnet imports from Australia. The move comes amid global supply concerns due to China’s export restrictions, which control over 90% of the world’s rare-earth magnet processing.
India is witnessing a rally in auto stocks after reports surfaced that the government may increase rare-earth magnet imports from Australia, aiming to reduce dependency on China. Companies like Eicher Motors, Maruti Suzuki India Ltd, and TVS Motor Company saw intraday gains of up to 2% on the National Stock Exchange.
Eicher Motors, headquartered in Gurugram, Haryana, is known for manufacturing the iconic Royal Enfield motorcycles and commercial vehicles. Maruti Suzuki, based in New Delhi, is India’s largest passenger car manufacturer. TVS Motor Company, from Chennai, Tamil Nadu, is a leading two- and three-wheeler manufacturer.
The surge in share prices followed reports by CNBC-TV18 that India is looking to diversify rare-earth supplies from Australia. This move is part of a larger strategy under the National Critical Minerals Mission to reduce China’s dominance, which accounts for nearly 90% of the world’s rare-earth magnet processing and 60% of production.
Rare-earth magnets are crucial components in electric vehicles (EVs), hybrid vehicles, and other electronics. In April, China imposed restrictions on exporting key rare earths such as dysprosium and neodymium, which are vital for magnet production. These restrictions have forced countries like India and the United States to rework supply strategies.
Despite India’s heavy dependence on Chinese imports—almost 80% of its rare-earth needs—the country’s low EV penetration (3% for passenger vehicles and 7% for two-wheelers) has mitigated the immediate impact on the auto sector. Conventional internal combustion engine (ICE) vehicles, which make up over 95% of the Indian market, use significantly fewer rare-earth materials.
The Indian government is also planning to boost domestic production and recycling of critical minerals and has instructed all mining operations to test waste materials for rare-earth content starting June 2025.
Earlier, Commerce and Industry Minister Piyush Goyal described China’s export restrictions as a “wake-up call” for the global economy, urging diversification and self-reliance in mineral sourcing.
The Nifty Auto index also saw strength from other players such as MRF, Bosch, and Mahindra & Mahindra, which recovered from earlier intraday lows, signaling broad market confidence in the sector’s resilience amid global supply chain shifts.
