The Union Cabinet has approved a landmark ₹7,280 crore incentive scheme aimed at boosting the domestic manufacturing of rare earth permanent magnets (REPMs) — a critical component used in electric vehicles, wind turbines, semiconductors, consumer electronics, and defence technologies.
According to PTI reports, this strategic move seeks to reduce India’s dependency on China, which currently dominates the global rare earth supply chain, and strengthen India’s position in advanced manufacturing.
The scheme aligns with the government’s vision of Atmanirbhar Bharat and supports India’s efforts to build resilient, indigenous supply chains in high-tech sectors.
What the ₹7,280 Crore Rare Earth Magnet Scheme Includes
The newly approved scheme aims to:
✔ Build a large domestic manufacturing ecosystem
Enabling industries to set up end-to-end production facilities for rare earth magnets.
✔ Achieve capacity of 6,000 MTPA
The government targets setting up large integrated units capable of producing 6,000 metric tonnes of permanent magnets annually.
✔ Support industries in EVs, aerospace, defence & renewables
Sectors that rely heavily on rare earth magnets stand to benefit significantly.
✔ Attract global & domestic investors
The initiative is expected to encourage global magnet-makers and Indian conglomerates to invest in India.
✔ Reduce import dependence
India currently imports a majority of these magnets from China; the new scheme aims to change that.
Why Rare Earth Magnets Matter
Rare earth magnets are essential for:
Electric vehicle motors
Renewable energy systems (wind turbines)
Drones and satellites
Defence equipment
Smartphones, laptops & audio devices
Robotics and advanced industrial machinery
Because these technologies are critical for future growth, building domestic capabilities is crucial.
How the Scheme Strengthens India’s Strategic Position
The government’s decision is seen as:
A move to secure critical mineral supply chains
A push toward technology self-reliance
A step to reduce geopolitical risk
An opportunity to create new advanced-manufacturing jobs
It also positions India to become a competitive player in the global rare earth market.
What Industries Can Expect Next
Major manufacturing tenders and proposals will open soon
Policies for mining & processing rare earth elements may be strengthened
Companies may collaborate with global magnet manufacturers
New R&D programs are likely to emerge in advanced materials
This scheme is expected to catalyze India’s next wave of high-tech industrial growth.
FAQs
1. What is the government’s new rare earth magnet scheme worth?
₹7,280 crore.
2. Why is India investing in rare earth magnets?
To reduce import dependence and build essential components for EVs, electronics, and defence.
3. How much production capacity is targeted?
6,000 metric tonnes per annum.
4. Which sector benefits the most?
EV manufacturing, renewable energy, aerospace, defence, and electronics.
5. Which country currently dominates this market?
China controls most of the global rare earth magnet production.
Published on : 26th November
Published by : SMITA
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Source Credit: Content inspired by reporting from PTI and corroborated by public economic policy reports.