India's Participation in Pax Silica

India has joined Pax Silica, a US-led coalition focused on technology and supply-chain resilience, primarily in semiconductors, AI infrastructure, and critical minerals. This move aims to reduce dependence on China, especially in rare-earth processing and semiconductor manufacturing.

Objectives and Members

• Pax Silica coordinates investments from mineral extraction to chip fabrication among its members, which include: 
  • The United States, Japan, South Korea, the United Kingdom, Singapore, Israel, the Netherlands, Australia, the United Arab Emirates, Qatar, and Greece.
  • Observers: Canada, the European Union, and Taiwan.

Strategic Rationale for India

• China processes over 90% of the world's rare-earth materials. India imports 80-90% of its rare-earth magnets from China.
• Joining Pax Silica may provide diversified sourcing, processing partnerships, and coordinated stockpiling.
• India's domestic initiatives include: 
  • ₹1.6 trillion investment in semiconductor projects with ₹76,000 crore incentives.
  • Global and domestic firms like Micron and Tata group investing in fabrication units.
  • Union Budget 2026-27 announcements: "Rare Earth Corridors" and a ₹7,280 crore "Rare Earth Permanent Magnet" scheme.

Broader Scope of Pax Silica

• Includes AI infrastructure, data centres, fibre networks, and foundational models.
• India's digital infrastructure, growing AI market, and engineering talent enhance its role in the coalition.

Challenges and Considerations

• Potential tradeoffs as supply chains split between China and Pax Silica-led systems.
• Risks of substituting one dependency with another, especially in advanced technology domains.
• Concerns regarding the long-term commitment of the US to multilateral agreements, affecting the coalition's stability.

Conclusion

Participation in Pax Silica offers India access to capital, technology, and markets. The success of this endeavor will depend on India's infrastructure readiness, regulatory clarity, environmental safeguards, and continued investment in research and manufacturing.