Raw Rare Earth Ore Wait for being processed (file photo); The report assessed that the import of rare earth magnets was on average $ 249 million in the last four years. | Photocredit: Nayan Sthankiya
Disruption of the range of rare earth can affect the financial exposure of banks such as transport equipment, basic metal, construction and electronic and electronics, as well as additional, influence, according to SBI Research.
SBI research, however, emphasized in its report that vulnerability is also a function of the available inventory of rare earth and disruption is not immediately uniform in different sectors.
The possible transmission mechanism for banks as a result of rare earth supply shock under worse scenario can include the extension of the working capital cycle as a result of the accumulation of semi-processed inventory, inactive capacity, etc.; volatility in the demand due to output unworkability; And probably the rise of stress in both electricity and electric sectors.
In this respect, the report also marked the mutual connections of the Non-Banking Finance Company sector (NBFC) to the banking sector; and export / traditions for dedicated yet unfulfilled obligations; Both funds such as non-funds (due to sudden limitations).
The newest RBIs Financial Stability Report has acknowledged that the domestic financial system can be influenced by external overflow and intensifying geopolitical hostilities.
“Since geopolitical factors determine the criticism of a mineral, the above analysis is one of the many dimensions of the impact of geopolitical factors on banking,” said Soumya Kanti Ghosh, economic adviser to group leader, State Bank of India.
The report assessed that the import of rare earth magnets was on average $ 249 million in the last four years. In FY25, the import of magnet $ 291 million was highest in the past four years.
Referring to the Indian Government of the Launch of the National Critical Mineral Mission (NCMM) in 2025 to set up a robust framework for self -reliance in the critical mineral sector and PSUs and private companies are supported by financing, guidelines, guidelines and interruptions that are an important work of work, the report are the report, the report the report, the report, the report, the report, the report, the report, the report that the report is the report policy focus and strategic instructions are.
Published on July 28, 2025
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