An Indian state-owned company in the business of mining rare earths that has been, more or less, defunct since 2004 has smelt an opportunity in growing global concerns about China’s decision to restrict supplies of these metals (it enjoys a near monopoly in terms of production). The declaration, by an official of Indian Rare Earths Ltd that the company will soon restart production of the metals, may fit into India’s larger diplomatic strategy of building stronger relations with Japan, the US and Europe, but this newspaper isn’t sure if this is an instance of a company tapping an opportunity or plain opportunism not backed by serious thought.
The extraction of rare earths is cumbersome and involves complex technology. It also takes a significant toll on the environment. And surely, a company that wasn’t competitive in 2004 cannot magically become competitive in 2010?