India is strategically positioning itself to tap into Myanmar's rich deposits of rare earth elements, as President Min Aung Hlaing visits New Delhi. The visit, marked by discussions with Prime Minister Narendra Modi, aims to enhance bilateral trade and explore opportunities in the rare earth sector.
Rare Earth Potential
Myanmar's Kachin and Shan states are known for their substantial deposits of rare earth elements such as dysprosium and terbium. These elements are crucial for manufacturing permanent magnets used in electric vehicles, wind turbines, and defense equipment. Currently, China is the primary extractor of these resources from Myanmar's Kachin state.
"The visit provides an opportunity for India to push its initiative in the rare earth sector," said a source familiar with the matter.
Bilateral Trade Growth
India-Myanmar trade relations have seen significant growth, with bilateral trade increasing by 23% to reach $2.15 billion in FY25. Myanmar's exports to India, primarily consisting of pulses, totaled $1.53 billion, while Indian exports stood at $614.3 million. Pulses alone accounted for 77% of Myanmar's exports to India, marking a 29% increase in FY25.
| Trade Metric | Value (FY25) |
|---|---|
| Total Bilateral Trade | $2.15 billion |
| Myanmar Exports to India | $1.53 billion |
| Indian Exports to Myanmar | $614.3 million |
Investment Landscape
India is the eleventh-largest investor in Myanmar, with 39 Indian enterprises investing a total of $782.821 million. This is part of the overall foreign investment in Myanmar, which amounts to $96.05 billion from 53 countries as of March 2025.
Strategic Implications
The discussions during President Min Aung Hlaing's visit are expected to address the strategic implications of rare earth extraction and the potential for India to diversify its supply chain away from China. The Myanmar Army's increased activity in border areas with rare earth deposits adds a layer of complexity to these discussions.
The outcome of these talks could significantly impact the future of India's rare earth supply chain, providing a strategic advantage in the global market.
