ndia-approves-815-million-plan-to-boost-rare-earth-magnet-production

India approves $815-million plan for rare earth magnet production

NEW DELHI, November 28, 2025 – India’s Cabinet has approved a USD 815-million scheme to develop domestic manufacturing of rare earth permanent magnets (REPMs) to reduce import dependence and strengthen supply chains, the government’s press bureau announced on Wednesday.

The initiative will support the development of 6,000 tonnes per year (tpy) of sintered magnet production capacity and has earmarked USD 92 million in capital subsidies to build manufacturing facilities and USD 723 million in sales-linked incentives.

The programme will last seven years, including two years to establish integrated manufacturing facilities and five years to disburse the incentives on REPM sales. Production quotas of up to 1,200 tpy will be allocated among five firms in a competitive bidding process.

With the move, India seeks to build up capabilities in advanced production stages for rare earths that the country currently lacks. They include converting rare earth oxides into metals, processing metals into alloys and transforming alloys into magnets.

REPMs are essential components in electric vehicles, renewable energy systems and electronics, as well as in aerospace and defence applications. Despite holding rare earth reserves, India meets most of its domestic demand for REPMs through imports. The country expects its consumption of REPMs will double by 2030, relative to 2025 levels.

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