New Delhi, Nov. 4 -- The Commerce Department and the Pentagon pledged on Monday to provide funding and possibly acquire equity in a US manufacturer of rare-earth magnets, a key issue in the ongoing trade conflict with China, the world's leading supplier.

The department issued a non-binding, preliminary letter of intent to allocate $50 million from the 2022 CHIPS Act to Vulcan Elements. This funding aims to help purchase equipment for producing permanent magnets used in fighter jets, wind turbines, and various other essential products, Bloomberg reported.

US-based rare earths company Vulcan Elements announced it is securing a $620 million direct loan from the Pentagon's Office of Strategic Capital, along with $550 million in private fund...