Southeast Asia is fast emerging as a pivotal player in the global semiconductor and rare earth mineral sectors and India is positioning itself as a key partner in reshaping this strategic supply network.
As global trade patterns shift amid intensifying US-China tariff tensions, India&rsquo;s economic diplomacy, resource exploration, and technology partnerships are aligning with international efforts to reduce dependence on Beijing&rsquo;s dominance in these critical industries.
A growing network of defence funding from the US, EU regulatory frameworks, Japan&rsquo;s strategic resource diplomacy through JOGMEC, and India&rsquo;s exploration capacity is steadily redrawing the region&rsquo;s supply chain map. Experts note that countries combining investment power, innovation, and high regulatory standards have the best chance to navigate this &ldquo;rare-earth era&rdquo; without falling prey to strategic chokeholds.
Trade Deals and Strategic Leverage&nbsp;
India&rsquo;s ongoing renegotiation of the ASEAN-India Trade in Goods Agreement (AITIGA) could be a game-changer. Current trade imbalances have tilted heavily against India, the country offered tariff concessions on 71% of its tariff lines, compared to far lower access from ASEAN members such as Indonesia (41%), Vietnam (66.5%), and Thailand (67%).
This gap has contributed to India&rsquo;s trade deficit with ASEAN soaring from $5 billion in 2010&ndash;11 to $43.57 billion in 2022&ndash;23, with semiconductors forming a significant share of imports.
Singapore has already taken a decisive step under the India-Singapore Comprehensive Strategic Partnership, which includes a dedicated MoU for semiconductor ecosystem cooperation. This aims to strengthen supply resilience while giving Singapore a deeper foothold in India&rsquo;s booming tech market.
Malaysia, one of India&rsquo;s largest trading partners with $20 billion in bilateral trade in 2023&ndash;24, is expected to face pressure to expand market access during renegotiations. Meanwhile, Vietnam represents the manufacturing hub model India is directly competing with, while Thailand and Indonesia are actively positioning themselves as alternative supply chain hubs to China.
Breaking China's Rare Earth Grip
Myanmar&rsquo;s rare earth resources remain a key strategic focal point. By investing alongside ASEAN partners in Myanmar&rsquo;s processing and mining infrastructure, India could help dilute Beijing&rsquo;s near-monopoly in rare earth processing.
Global initiatives such as the G7 Critical Minerals Action Plan, backed by Australia, India, and South Korea, are expected to accelerate Southeast Asia&rsquo;s capabilities in both processing and infrastructure, creating opportunities for India to deepen its role in the region&rsquo;s industrial future.
If these strategic moves succeed, India could emerge not only as a manufacturing hub but also as a crucial geopolitical counterweight in the global semiconductor and rare earth supply chain.

India’s Role in ASEAN Chip & Mineral Shift

India eyes major role in reshaping Southeast Asia’s tech and rare earth supply chains

India’s Role in ASEAN Chip & Mineral Shift

India eyes major role in reshaping Southeast Asia’s tech and rare earth supply chains

August 14, 2025 | 16:33 IST