US seeks India's support to counter China’s rare earth power play?

The US-China trade war has entered a volatile new phase, with Washington rallying allies—including India—to counter Beijing’s latest economic move, which threatens to upend global supply chains.

US Treasury Secretary Scott Bessent has accused President Xi Jinping’s administration of taking “provocative” steps after China tightened export controls on rare earth minerals—critical inputs for industries ranging from defence and electronics to electric vehicles.

Recently, while speaking to a foreign media news channel, Bessent warned, “This is China versus the rest of the world. They announced these export controls that are going to go into effect next month, and we have aggressively pushed back against them. We're not sure where this came from, why the Chinese have decided to do it now.”

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US seeks India’s partnership

According to Bessent, Washington will not allow Beijing to “weaponise” its grip over rare earths, which form the backbone of modern manufacturing and energy sectors. “They have pointed a bazooka at the supply chains and the industrial base of the entire free world. And, you know, we're not going to have it. China is a command and control economy. They are neither going to command [nor] control us,” he said.

The Treasury Secretary confirmed that the US has already started coordinating a global alliance to respond to China’s move, with India playing a crucial role alongside Europe and other Asian democracies. “We are going to assert our sovereignty in various ways. We have already been in touch with the allies. We will be meeting with them this week and, you know, I expect that we will get substantial global support from the Europeans, from the Indians, from the democracies in Asia,” he added.

Also Read: China warns US against pressure tactics, says talks must be held on equal terms amid fresh tariff dispute

China’s export curbs deepen supply chain concerns

Beijing’s new export rules, announced on October 9, require government approval for any product containing more than 0.1 per cent rare earth elements by value. The restrictions also broaden the list of controlled minerals and prohibit exports for foreign military use.

China currently dominates nearly 70 per cent of global rare earth mining and 90 per cent of processing a stranglehold that gives it unmatched leverage in the global tech and energy markets. Among the most critical elements is dysprosium (atomic number 66), used in electric vehicle motors, semiconductors, wind turbines, and missile systems.

Bessent likened their importance to “baking powder in a bakery,” saying they are “used in small quantities, but absolutely essential.”

The export curbs, which Beijing claims are meant to safeguard “national security amid frequent military conflict,” have rattled markets and triggered an aggressive American response.

Also Read: Trump Threatens China: Could US end soybean and cooking oil imports?

Trump’s tariff shock escalates trade war

US President Donald Trump has responded by threatening to impose 100 per cent tariffs on Chinese imports beginning November 1, effectively doubling existing rates to around 130 per cent.

Calling China’s move “extraordinarily aggressive,” Trump said the US would take “strong measures to defend our industries.” Yet, in an apparent attempt to calm markets, he later posted on Truth Social, “It will all be fine. President Xi just had a bad moment. He doesn’t want depression for his country, and neither do I. The USA wants to help China, not hurt it!!!”

Despite his tough rhetoric, Trump’s shifting stance has once again led Wall Street analysts to nickname him “TACO” short for “Trump Always Chickens Out” a reference to his history of walking back from tariff threats.

‘China is hurting itself'

Bessent argued that Beijing’s actions signal vulnerability, not dominance. In an interview as reported by foreign media, he said, “This is a sign of how weak their economy is, and they want to pull everybody else down with them. Maybe there is some Leninist business model where hurting your customers is a good idea, but they are the largest supplier to the world. If they want to slow down the global economy, they will be hurt the most.”

He further claimed China is “in the midst of a recession or depression” and attempting to “export their way out of it,” warning that such tactics would only “exacerbate their standing in the world.”

US pushes for global unity and de-risking

Amid the rising tensions, Bessent reiterated that Washington is “willing to do whatever it takes” to stabilise supply chains and maintain open trade channels. “Everything's on the table. I am optimistic that this can be de-escalated … lines of communication have been opened … But, the US will not be deterred here. And, you know, as I said, this is China versus the world. And the Chinese have a different business model than we do. But there is no business model that shows it is a good idea to harm your customers. China is the largest exporter in the world, and they are dependent on trade. We do not want to decouple. We want to de-risk,” he added.

Despite the spiralling tensions, a diplomatic opening may still emerge. Bessent confirmed that President Trump and Xi Jinping are scheduled to meet later this month in South Korea.
“He will be meeting with Party Chair Xi in Korea, I believe that meeting will still go ahead,” he said.

Before that, both nations will hold staff-level discussions in Washington during the IMF and World Bank meetings, followed by a session between Bessent and Chinese Vice Premier He Lifeng in Asia.