China vows to resume key exports to India amid thaw

• 19th August 2025

China committed to resuming critical exports to India during Chinese Foreign Minister Wang Yi’s diplomatic visit to New Delhi, marking a significant breakthrough in bilateral trade relations strained by Beijing’s prolonged restrictions on key commodities.

Chinese Foreign Minister Wang Yi assured External Affairs Minister S. Jaishankar on Monday that China would address India’s pressing concerns regarding the supply of fertilizers, rare earth minerals and tunnel boring machines, according to sources familiar with the discussions. The commitment came during high-level talks that also touched on border peace, economic cooperation and bilateral exchanges.

Strategic Trade Concessions Amid Diplomatic Thaw
According to The Economic Times, China has promised to address India’s three main concerns: rare earths, fertilizers and tunnel boring machines. This assurance represents a reversal of China’s restrictive trade policies that have disrupted Indian industries for nearly a year.

The timing is particularly significant as it follows External Affairs Minister Jaishankar’s visit to China in July, where he first raised these concerns. During his opening remarks with Wang Yi, Jaishankar emphasized that “restrictive trade measures and roadblocks” should be avoided between the two major economies.

China’s Export Restrictions Impact Multiple Sectors
China had imposed extensive export controls starting in April 2025, when it tightened restrictions on rare earth elements citing “end-use regulations” and the need to “safeguard national security”. These measures effectively halted shipments of rare earth magnets essential for India’s electric vehicle and electronics industries.

The fertilizer sector faced similar disruptions, with China suspending exports of specialty fertilizers crucial for high-value crops like fruits and vegetables. India imports approximately 80 percent of its specialty fertilizers from China, with annual imports typically reaching 150,000-160,000 tonnes during the June-December period.

China also blocked tunnel boring machines critical for India’s Mumbai-Ahmedabad bullet train project, creating delays in the ambitious infrastructure initiative.

Broader Diplomatic Context
Wang Yi’s visit comes amid improving India-China relations following an agreement last October on patrolling protocols along the Line of Actual Control. The Chinese Foreign Minister is scheduled to meet Prime Minister Narendra Modi and participate in Special Representative talks with National Security Advisor Ajit Doval on border issues.

The diplomatic engagement occurs ahead of Prime Minister Modi’s expected visit to China for the Shanghai Cooperation Organisation summit from August 31 to September 1, marking his first trip to China in seven years.

Both countries acknowledged the need for closer cooperation amid global uncertainties, particularly regarding U.S. trade policies under President Donald Trump. As one report noted, “both sides agreeing that they need to come closer due to prevailing policies of Washington”.

China supplies nearly 30 percent of fertilizers to India for agriculture, rare earths for auto parts manufacturing, and tunnel boring machines for road and urban infrastructure development. The resumption of these critical supplies could significantly benefit India’s agricultural productivity and industrial development.