The Unseen Hand

REEs, or rare earth elements, are the most important parts of modern technology and national security. These important minerals are used to power everything from smartphones and electric vehicles (EVs) to advanced fighter jets and wind turbines. Their one-of-a-kind magnetic, catalytic, and optical properties make them irreplaceable in high-performance uses. As the world moves faster towards a future without carbon and with digital connections, the demand for REEs is skyrocketing. This makes them even more important to the energy transition and technological revolution. For example, neodymium-iron-boron (NdFeB) magnets are the most important part of efficient electric motors, which are important for EVs and other car parts. Without them, our plans to go green come to a halt, technological progress slows down, and national security is put in serious danger.

This rising demand, on the other hand, runs into a cautious fact: China controls almost the entire rare earth value chain. For decades, Beijing has carefully built a stranglehold on not just mining, but more importantly, on advanced processing, refining, and the making of important rare earth magnets. This isn't just being the leader in the market; it's a strategic near-monopoly that puts global industries and national security at risk of economic coercion, price manipulation, and huge supply chain problems. "Critical minerals" for REEs doesn't mean that they are rare in nature; it means that they are being turned into useful, high-value alloys in a small area,which is very concerning. The problem isn't with the ground; it's with the complicated and expensive midstream and downstream parts. This issue needs a long-term, multi-generational commitment, with the help of strategic state intervention and unprecedented international cooperation.

In this situation of strategic weakness, the Quadrilateral Security Dialogue (Quad), which includes India, Australia, Japan, and the United States, has triedto become a symbol of collective determination. The Quad Critical Minerals Initiative is a strategic turning point that shows a shared commitment to "strengthen economic security and collective resilience by collaborating to secure and diversify critical minerals supply chains."

The Chinese Grip

China has a lot of power over the rare earth sector, and this power runs deep through every part of the value chain. China was responsible for more than 69% of the world's rare earth mine production in 2023. More importantly, it processes almost 90% of the world's rare earth elements, giving it almost complete control over the making of high-performance rare earth magnets. The United States has become a major producer again, with a share of 12.3%. However, China's huge lead in midstream processing is still the most important problem. In December 2023, Beijing made its advantage even stronger by banning the export of technologies for extracting and separating rare earths.

Beijing has shown many times that it is willing to use this market power as a weapon. When foreign companies try to get important minerals from China, they often run into "bureaucratic hurdles." These include unclear end-user licenses and local government endorsements that cause frustrating delays or outright denials, especially for countries like India. China has gone so far as to force foreign carmakers to buy whole electric motor assemblies from Chinese companies instead of letting them get rare earth magnets separately. China has also limited the export of certain heavy rare earth metals (like dysprosium and terbium) and rare earth magnets, as well as other high-tech materials like gallium and germanium, often saying that they are for "military applications." These actions are widely seen as "weaponised export controls" that are meant to put diplomatic and economic pressure on other countries.

The effect on Quad members has been quick and painful. For example, India's growing electric vehicle (EV) industry has been hit hard because Chinese authorities have been delaying or denying applications for rare earth magnets. This has caused major shortages and could cause delays in production plans. China's export limits have had an effect on the auto supply chain around the world, causing major carmakers to stop making cars. Even though these restrictions have hurt Chinese magnet makers, they show that Beijing is willing to take economic losses for strategic gain. The US is especially vulnerable to limits on processing heavy rare earths because China has almost complete control (99.9%) over separating them. This isn't just a problem with the supply chain; it's a threat to national security that needs quick, coordinated action.

The Quad's Promise

Australia, the United States, Japan, and India are all vibrant democracies that work together as a strategic diplomatic alliance. The alliance is fundamentally committed to a free, open, and resilient Indo-Pacific. Its strategic focus has grown beyond just security issues to include making the economy more resilient and making sure that important supply chains for important minerals are safe. The Quad Critical Minerals Initiative (QCMI), which started in July 2025, is the main part of this larger plan. Its goal is to strengthen economic security and collective resilience by collaborating to secure and diversify critical mineral supply chains.The Quad members each have their own unique strengths that work well together to bring down China's influence:

Australia is the clear leader in resources in the Quad. It has large reserves of important minerals like lithium (37% of the world's supply), zinc (28% of the world's reserves), germanium, gallium, and huge deposits of rare earths. Australia has more resources and mining knowledge than any other country, and by 2035, it wants to process 15% of the world's rare earth elements. The government's large investment in its Critical Minerals R&D Hub shows that it is serious about building advanced processing capacity.

Japan is known around the world as a leader in refining and processing minerals, especially rare earth elements (REEs). Japan has brought parts of its minerals processing industry back to life through smart government policies. This shows that it is possible to be resilient. It is a leader in global efforts like the World Bank-led Resilient and Inclusive Supply-chain Enhancement (RISE) initiative, which shows how committed it is to working with other countries.

The US has a strong policy drive and an advanced industrial base that is important for making semiconductors and batteries. Executive orders are speeding up mining projects and freeing up money to protect supply chains in the US. It leads multilateral efforts like the Minerals Security Partnership (MSP) and has made important bilateral deals like the Transforming Relationship Utilising Strategic Technology (TRUST) initiative with India. The Loan Programs Office of the Department of Energy has given out billions of dollars in loans, which gives critical mineral projects a lot of financial power.

India has a rapidly growing market and a growing manufacturing base, especially in the important areas of EVs and batteries. It also has one of the largest sources of known untapped REE resources. Its historical ties and growing power in resource-rich areas like Africa and Southeast Asia give it important diplomatic power. India's own ambitious National Critical Mineral Mission (NCMM), which costs a lot of money, aims to improve its own supply chain for critical minerals. Its formal joining of the MSP in June 2023 shows that it is serious about this goal.

Making the Dream a Reality: Moving Forward

The Quad nations need to invest in exploration, mining, and, most importantly, advanced processing and refining capabilities. Australia's active investment in building lithium refineries and its ambitious goal to capture 15% of global REE processing by 2035 are important steps. The executive orders from the United States that are meant to speed up mining projects and free up funding are just as important. India's National Critical Mineral Mission (NCMM) shows that the country wants to increase exploration at home and pay for assets abroad. But India needs to deal with its problems: unexplored domestic reserves, a lack of advanced extraction technology, and not enough money. It is still a difficult task that costs a lot of money and takes a lot of time to catch up to China's decades-long lead in midstream and downstream operations. The Quad's main strategic goal should no longer be just getting access to raw materials. Instead, it should be to heavily invest in and make it easier for technology to be transferred for processing and refining capabilities.

It is important to encourage joint research and development, technology transfer, and partnerships between businesses and schools. Collaborative R&D forums can help make processing more efficient and less harmful to the environment. The US-India TRUST program, which is all about working together to create new extraction and processing technologies, is a great example. India, in particular, needs to actively push for strong R&D investment and academic exchanges in these partnerships so that building up its own capacity and encouraging scientific innovation are at the top of the list. Governments need to become active "de-riskers" and co-investors by strategically using public money to get private money to invest.

Conclusion

The Quad is in a unique position to lead the global diversification of critical mineral supply chains because of its unique and complementary strengths: Australia's wealth of resources, Japan's advanced processing technology, the United States' leadership in research and development and financial mechanisms, and India's growing market demand and strategic diplomatic reach. Its wide-ranging efforts show that it has a multi-pronged, cooperative, and strategically sound approach.The Quad's dream of rare earth minerals won't come true overnight. It will take a lot of political will, a lot of money, and constant innovation across the entire critical minerals value chain. To get rid of China's deeply rooted dominance, we need a long-term strategic vision that goes beyond short-term economic cycles and political changes. The race for critical minerals is a major geopolitical contest of the 21st century, as access to these resources will determine who has power and influence in the future. The expected huge rise in demand because of decarbonisation and digitalisation makes them even more strategically valuable. The Quad's success or failure will have a big effect on the balance of power in the world, who leads in technology, and how fast and fairly the transition to green energy happens.

The opinions expressed in this publication are those of the authors. They do not purport to reflect the opinions or views of New Spotlight

Harsh Pandey is a PhD Candidate at the School of International Studies, Jawaharlal Nehru University, New Delhi,