Japan turns to India for rare earth metals

Japan is set to commence imports of rare earth metals for India in order to hedge against worsening relations with chief supplier China.

The Asahi Shimbun reports that Japan is expected to announce the start of imports from India during a state visit by Indian Prime Minister Manmohan Singh next month.

India is expected to export 4,000 tons of rare earth minerals to Japan, supplying 15% of annual need.

Tensions between China and Japan have escalated in recent months due to disputed ownership of the Diaoyu Islands in the East China Sea.

China is considered by many to possess a strange-hold on rare earth minerals, producing over 95% of global supply on the back 37% of proven reserves.

Japan conversely is the world's largest importer of rare earth minerals, which are indispensable ingredients for a slew of hi-tech products including smart phones and wind turbines.

This places Japan in a formidable strategic quandary, as China still harbours grievances against Japan for atrocities committed during in the Second World War and its imperial past.

China has used its dominance of rare earth supply in its disputes with Japan in the recent place, placing de facto embargo upon exports of the minerals to its archipelago neighbour in 2010.

Japan has thus striven to diversify its sources for the crucial industrial metals, reaching out to India now as an alternate source of supply.

Asashi also reports that Toyota Tsusho Corp and an Indian resource developer are currently undertaking preparations for the establishment of a joint venture to import rare earths to Japan.