November 27, 2025: The Union Cabinet has approved a ₹7,280, crore scheme to establish India’s first integrated manufacturing capacity for sintered Rare Earth Permanent Magnets (REPMs), aiming to reduce import dependence and support sectors such as electric mobility, renewable energy, electronics, aerospace and defence. The decision marks a major industrial-policy push as demand for high-performance magnets is projected to double between 2025 and 2030.
The scheme targets the creation of 6,000 metric tonnes per annum of REPM manufacturing capacity, covering the full production chain, from rare earth oxides to metals, then alloys, and finally finished magnets. India currently imports almost all REPMs required for domestic industries.
According to the government, the rapidly expanding EV and renewable-energy ecosystem is driving the need for a secure and localised magnet supply chain. Establishing domestic capacity is expected to support India’s broader goals of industrial self-reliance and long-term decarbonisation, including the Net Zero 2070 commitment.
India Sets 6,000-MTPA Rare Earth Magnet Supply Chain Goal Under ₹7,280 Cr Scheme
The financial structure includes ₹6,450 crore in sales-linked incentives over five years and ₹750 crore in capital subsidies to build the proposed 6,000-MTPA capacity. The government plans to allocate capacity to five beneficiaries, each eligible for up to 1,200 MTPA, through a global competitive bidding process.
The scheme will run for seven years, including a two-year gestation period to set up manufacturing facilities and five years for incentive payouts linked to verified REPM sales.
Officials said the initiative is designed to strengthen India’s position in the global rare-earth magnet market while ensuring supply-chain security for domestic industries preparing for rapid adoption of electric mobility and clean energy technologies. The move also aligns with the broader vision of Viksit Bharat @2047, which aims to advance high-value manufacturing and reduce strategic import dependence.
