Shares of state-owned miner Gujarat Mineral Development Corporation (GMDC) were the winners in the market on 18 July, surging over 14% to a record high of ₹233, as investor sentiment turned bullish ahead of a high-level stakeholder meeting reportedly convened by the Prime Minister’s Office (PMO). The meeting is expected to address India’s growing concerns over a global rare-earth magnet crisis, an arena GMDC is preparing to enter.
The company has previously hinted at ambitions to step into the critical minerals space, particularly rare earths, though it has yet to officially unveil a detailed roadmap. In May, the GMDC management called rare earths a potential “value driver”, given their crucial role in permanent magnets used across the electric vehicle (EV) supply chain, defence, and renewable energy sectors. The company had earmarked ₹3,000–4,000 crore for critical mineral projects, without elaborating further.
Market sentiment intensified after a CNBC-TV18 report cited sources, claiming the PMO would hold a key meeting on the matter this afternoon. The urgency stems from recent warnings issued by India’s electronics industry, which flagged ‘informal sanctions’ by China on rare earth exports and equipment. These disruptions, they argue, could severely impact India’s export-linked smartphone manufacturing, placing it under 'serious risk.'
Automakers, too, raised the red flag back in May and June, cautioning that their production pipelines could falter if China’s rare earth magnet supplies remained restricted. These magnets, crafted from rare earth elements (REEs) are indispensable to EVs and renewable energy technologies.
In response, the Ministry of Heavy Industries is reportedly considering easing localisation norms temporarily to allow the import of fully built motors, providing short-term relief for EV players. At the same time, an incentive scheme is believed to be under inter-ministerial consultation to promote domestic rare earth processing.
“A scheme has been circulated for ₹1,345 crore to subsidise rare earth magnet manufacturers,” said Heavy Industries Minister HD Kumaraswamy recently. “Initially, two manufacturers are proposed under this scheme, though this could evolve as plans are finalised.”
Earlier in June, NSA Ajit Doval met Chinese Foreign Minister Wang Yi in Beijing on the sidelines of the SCO meeting, where they reviewed bilateral ties and underlined the need for sustained cooperation. On the same issue, Commerce Secretary Sunil Barthwal confirmed that India remains in diplomatic dialogue with China to ensure uninterrupted access to rare earth imports.
In the face of these uncertainties, GMDC is emerging as a potential domestic anchor in India’s rare earth strategy. Alongside GMDC, other listed state-run and private players like NMDC, Coal India, Hindustan Zinc, Vedanta, and MOIL are being seen as possible frontrunners in India’s rare earth race. While the Centre has auctioned four blocks of strategic minerals this year, only one so far is dedicated exclusively to rare earth elements.
With the stakes rising and supply chains under pressure, the spotlight is now firmly on GMDC as investors analyse what it might become in the unfolding geopolitical game of chess over critical minerals.
