Modi meets Myanmar president as India seeks rare earths trade
What's the story
Myanmar President Min Aung Hlaing, who is on a five-day visit to India from May 30 to June 3, met Indian Prime Minister Narendra Modi on Monday at Hyderabad House. During his stay, he will also meet Indian President Droupadi Murmu, Prime Minister Narendra Modi, Foreign Minister Dr S Jaishankar, and Indian business leaders. The key focus of these meetings will be Myanmar's rich deposits of rare earth elements (REEs) as global powers seek alternatives to China's supply chains.
Resource potential
Myanmar's rare earths and their global significance
Myanmar is the world's fourth-largest producer of rare earths, after the United States, Australia, and India. It has large deposits of heavy rare earths like dysprosium and terbium in its Kachin and Shan states. These elements are essential for high-performance permanent magnets used in electric vehicles (EVs), wind turbines, and defense technology. Their main utility lies in acting as heat shields, enabling magnets to retain properties at high temperatures.
Strategic importance
Importance of rare earths for India
India's interest in these resources is particularly strategic as it seeks to develop its own fighter jets. Dysprosium and terbium are vital for aero-engines that require rare earth superalloys to withstand extreme temperatures; radars using rare earth magnets; and stealth coatings on aircraft. Currently, most of these deposits are exported or smuggled to China for processing since Myanmar lacks refining capacity.
Economic ties
Growing bilateral trade and investment
Bilateral trade between India and Myanmar has grown significantly over the years, reaching $2.15 billion in FY25. India is Myanmar's fourth-largest trading partner, with pulse exports accounting for around 77% of Myanmar's exports to India. The rupee-kyat settlement mechanism launched in January 2024 also offers potential for further expanding bilateral trade. India is currently the 11th-largest investor in Myanmar, with approved investments totaling US$782.821 million by Indian enterprises.