Scott Targets China, Calls for US-India Rare Earths Alliance

Treasury Secretary Scott Bessent: Tensions between Washington and Beijing have flared once again, this time over rare earth minerals, with the United States openly eyeing India as a potential ally in what is shaping up to be a high-stakes global economic battle.

US Treasury Secretary Scott Bessent issued one of his sharpest rebukes yet against Beijing, accusing President Xi Jinping’s government of deliberately weaponizing its dominance in rare earths — critical minerals used in electric vehicles, smartphones, and advanced defense systems.

“This is China versus the world,” Bessent said in an interview with Fox Business, warning that Beijing’s decision to impose export controls on rare earths amounts to “pointing a bazooka at the supply chains and the industrial base of the entire free world.”

Bessent, who has previously criticized both India and China for their purchase of Russian oil during the Ukraine war, took a different tone this week. He stressed the importance of securing support from democratic nations. “We will be meeting with allies this week, and I expect substantial global support — from the Europeans, from the Indians, from the democracies in Asia,” he noted, hinting strongly at a US-India rare earths alliance as a counterbalance to China’s dominance.

Scott: Trump Raises Tariffs, Escalates Rare Earths Battle

Bessent’s remarks followed President Donald Trump’s announcement of 100% additional tariffs on Chinese goods in retaliation for Beijing’s export restrictions. The move threatens to revive the trade war that both countries had only recently attempted to de-escalate.

“They are in the middle of a recession, maybe even a depression, and they are trying to export their way out of it,” Bessent said in a separate interview with the Financial Times.

Trump has also hinted at canceling a planned meeting with Xi Jinping at the Asia-Pacific Economic Cooperation (APEC) summit later this month, casting fresh uncertainty over relations between the world’s two largest economies. Beijing, for its part, has vowed to “fight to the end” in response to new US tariffs, calling Washington’s actions hypocritical and destabilizing.

India at the Center of the Geopolitical Tug-of-War

India now finds itself in a delicate position. On one hand, New Delhi has been under pressure from Washington, facing 50% US tariffs on several goods while still pushing forward with negotiations for a bilateral trade agreement. On the other, Prime Minister Narendra Modi has recently made overtures to Beijing, seeking to reset strained ties following years of border tensions.

Despite these complexities, Washington views India as a crucial partner in stabilizing global supply chains. With its untapped rare earth reserves and strategic location, India could play a pivotal role in diversifying away from Chinese dominance.

The US-India rare earths alliance, even if informal at this stage, carries immense geopolitical significance. By collaborating on technology, mining, and processing, the two democracies could mitigate risks of overdependence on Beijing.

Scott: Mixed Signals but Ongoing Negotiations

Trump’s messaging towards India has been notably inconsistent. While he continues to describe tariffs as his “favorite word,” he has also praised Prime Minister Modi as a “good friend” and “great leader.” At the Gaza peace summit in Egypt on Monday, Trump simultaneously extended warm remarks towards Pakistan while sprinkling in compliments for Modi, signaling the delicate balance the White House is trying to maintain in South Asia.

Meanwhile, trade negotiations between New Delhi and Washington continue. Senior Indian officials are set to travel to the US this week for talks on a Bilateral Trade Agreement (BTA), first outlined in February after Trump’s return to office. Sources close to the negotiations suggest the two sides are aiming to finalize the first tranche of the deal by late fall 2025.

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