AI, Rare Earths, and the Geopolitical Algorithm: Strategic Intersections of India, China, and the U.S. in the 21st Century Tech Race

Abstract

Artificial Intelligence (AI) has transcended its origins as a technological innovation to become an indispensable pillar underpinning 21st-century economic dynamism, national security architectures, and the evolving contours of international competitiveness. While public and scholarly discourses predominantly emphasize data algorithms, machine learning paradigms, and software advancements, the material substratum of AI’s rapid evolution remains underexplored. At the core of AI’s hardware ecosystem lie rare earth elements (REEs)—a suite of 17 critical minerals that enable the functioning of semiconductors, advanced computing infrastructures, quantum processors, and renewable energy technologies vital to AI scalability.
This paper interrogates the multidimensional and complex interdependence between AI proliferation and the geopolitics of REE supply chains, with a nuanced focus on the strategic triad of India, China, and the United States. China’s hegemony over global REE mining and processing—commanding approximately 60% of extraction and a staggering 85% of refining capacity—has bestowed upon Beijing a formidable leverage in resource politics. This monopolization raises significant implications for the technological sovereignty of AI-reliant economies. In response, the United States and India have embarked upon diversification trajectories, encompassing policy recalibrations, technological innovations, and plurilateral partnerships aimed at mitigating asymmetric dependencies and fostering resilient, autonomous AI infrastructures.
Employing an interdisciplinary analytical framework, this study critically evaluates recent policy architectures, bilateral and multilateral trade alignments, and state-backed technological investments. It draws upon empirical data and comparative case studies to elucidate how resource geopolitics and AI aspirations are converging to recalibrate global power hierarchies in 2025 and beyond. Furthermore, the paper articulates a forward-looking paradigm advocating for multilateral governance mechanisms, emphasizing sustainable resource stewardship, ethical technological collaboration, and the construction of resilient and diversified supply chains to safeguard technological futures.