China promises to address India's rare earths needs as border talks begin: Indian source

There is an upward trend in India-China relations and Beijing has promised to address New Delhi's needs on rare earths, a top Indian official and a source said on Tuesday, as the neighbours rebuild ties that were damaged by a 2020 border clash.

Chinese Foreign Minister Wang Yi is visiting India for the 24th round of border talks with Indian National Security Advisor Ajit Doval and is also due to meet Prime Minister Narendra Modi on Tuesday, days before Modi travels to China for the summit of the Shanghai Cooperation Organisation.

"There has been an upward trend. Borders have been quiet. There has been peace and tranquillity," Doval told Wang as he opened the talks. "Our bilateral engagements have been more substantial."

"The new environment that has been created has helped us in moving ahead in the various areas that we are working on," he said.

Wang said the setbacks the two countries experienced over the past few years were not in the interests of the people of the two countries, according to a translation of his remarks by Indian news agency ANI.

Earlier on Tuesday, an Indian source said that China had promised to address three key Indian concerns. Wang, the source said, had assured Indian Foreign Minister Subrahmanyam Jaishankar that Beijing is addressing India's need for fertilisers, rare earths and tunnel boring machines.

The Indian foreign and mines ministries did not respond immediately to Reuters requests for comment.

China's commerce ministry also did not immediately respond to a request for comment.

It was not immediately clear whether China had agreed to approve export licenses faster or grant blanket exemptions for India.

China has previously committed to speeding up export licenses for Europe and the US without actually dismantling the control regime.

China's exports of rare earths and related magnets jumped in June after these agreements and as the commerce ministry worked through a huge backlog of applications.

However, rare earth magnet exports to India were still down 58% compared to January levels, according to Chinese customs data. June is the last month for which country-level data is available.

India has the world's fifth-largest rare earth reserves, at 6.9 million metric tons, but there is no domestic magnet production. India relies on imported magnets, mainly from China.