The Group of Seven (G-7) economies are working to strengthen supplies of critical minerals as they attempt to reduce their dependence on China for resources used in a range of products from smartphones to wind turbines.Leaders of the bloc are aiming to sign off on a statement at their meeting in Kananaskis, Canada, which will establish an “action plan” to diversify sourcing of key metals and support “immediate and scaled investment” in projects, according to a draft document seen by Bloomberg. Without naming China — the source of nearly 70% of global rare earth output — the draft referred to a “threat to our economies” from current practices in the minerals sector.China accounts for more than 90 per cent of the world’s processing capacity for magnets, which are used in various sectors such as automobiles, household appliances, and clean energy. From April 4, the Chinese government has introduced restrictions that require special export licences for seven types of rare earth elements and the magnets made from them.Reuters also reported, citing the draft statement, that G-7 leaders had provisionally agreed on a strategy to protect critical mineral supplies and support economic stability. According to the agency, the draft — which has yet to be approved by US President Donald Trump — also said mineral markets should reflect the actual costs of responsible mining, processing and trading of these materials.Last week, the US and China announced a deal that would allow continued supply of rare earth magnets to the US, despite China’s earlier restrictions in response to Trump’s tariffs.Meanwhile, India is expecting a favourable result from its discussions with China over Beijing’s restrictions on exports of rare earth magnets, which are mainly used in the automotive industry, Commerce Secretary Sunil Barthwal said on Monday. China’s curbs on rare earth elements and related magnets are having an impact on India’s auto and white goods sectors.Also Read: India may 'facilitate' magnet relief for auto cos as China keeps rare earth keys“We have shared national and economic security interests, which depend on access to resilient critical minerals supply chains governed by market principles,” the draft statement said. “Non-market policies and practices in the critical minerals sector threaten our ability to acquire many critical minerals, including the rare earth elements needed for magnets, that are vital for industrial production.”The exposure of Western economies to supply risks has been growing since April, when China, retaliating against US tariffs, imposed export controls on seven rare earth elements. Over the past two years, it had also restricted exports of other vital materials such as gallium, germanium, graphite and antimony.“We recognize the need to work together to increase investment in responsible critical minerals projects within the G-7 and around the world,” the draft said. “Immediate and scaled investment is required to secure future supply chains and ensure promising mining and processing projects overcome barriers such as delays in permitting and approvals processes, market manipulation, and price volatility.”In Europe, some automotive parts manufacturers have recently received approvals to source rare earth magnets. However, the Indian arms of these companies are still waiting for clearances from China’s commerce ministry. Experts say the situation is further complicated by the uneasy political and commercial ties between India and China.Indian firms have been working to build domestic capacity to reduce dependence on imports, but experts say the task remains challenging.Rare earth magnets are essential in permanent magnet synchronous motors (PMSMs), which are a key technology in electric vehicles because of their torque, energy efficiency, and compact form. Hybrid vehicles also rely on these magnets for efficient operation.The G7 includes Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States, alongside the European Union. India has also been invited to attend the summit.