India will set up an integrated rare-earth permanent magnet (REPM) manufacturing ecosystem with a budgetary outlay of ₹7,280 crore over seven years. The initiative aims to sharply reduce import dependence and strengthen domestic supply chains for electric mobility, electronics, defence, and aerospace—key sectors that rely on high-performance permanent magnets.
Building 6,000 TPA Domestic Magnet Capacity
The scheme will establish 6,000 tons per annum (TPA) of REPM manufacturing capacity across five units of 1,200 TPA each. Manufacturers will start production within the next two to three years. India currently consumes about 4,000–5,000 TPA of permanent magnets, importing nearly all of them.
Creating India’s First End-to-End Value Chain
For the first time, India will develop the entire value chain—from rare-earth oxide refining to metal, alloy, and sintered magnet manufacturing—within the country. The government will provide capital expenditure support of around 30%, along with production-linked incentives. Total investment from industry is expected to be three times the government’s commitment. India ranks among the world’s top three nations in rare-earth reserves, with 6.9 million tonnes spread across coastal placer sands and hard-rock deposits in multiple states. The programme aligns closely with India’s Critical Minerals Mission and its broader semiconductor manufacturing drive.
Strengthening Strategic and Industrial Capabilities
Industry consultations received strong interest from electronics, EV, steel, medical equipment, and defence manufacturers. India is also collaborating with Japan and Australia on critical minerals and magnet technologies. The scheme is expected to accelerate clean mobility adoption and strengthen India’s sustainability agenda. Shailesh Chandra, President of the Society of Indian Automobile Manufacturers, said the initiative will help reduce carbon emissions. It will also cut dependence on crude oil imports, further enhancing national energy security.
Ensuring High Environmental Standards
Both government and private-sector players—including semiconductor and automotive companies – have expressed interest. Downtoearth.org.in reports that rising domestic demand will drive the scheme to meet India’s needs and boost export capacities in the coming years.
