India Finalizes ₹7,280 Cr Rare Earth Magnet Manufacturing Scheme
Overview
India is nearing the launch of a ₹7,280 crore incentive scheme to establish domestic manufacturing capacity for rare earth permanent magnets. Union Minister H.D. Kumaraswamy is urging domestic and international companies to bid for the RFP, aiming to build a self-reliant REPM ecosystem vital for sectors like electric mobility and renewable energy.
India Pushes Rare Earth Magnet Manufacturing
The Indian government is in the final stages of preparing a Request for Proposal (RFP) for a significant ₹7,280 crore incentive scheme designed to bolster domestic manufacturing capabilities for sintered rare earth permanent magnets (REPMs).
Union Minister for Heavy Industries and Steel, H.D. Kumaraswamy, announced on Monday that the RFP is being finalized. He appealed to both domestic and international industry players to participate in the upcoming bidding process.
Building a Self-Reliant Ecosystem
Minister Kumaraswamy described the scheme as a vital intervention to foster a resilient and globally competitive REPM ecosystem, aligning with the nation's 'Viksit Bharat @2047' vision. He encouraged eligible companies to seize this opportunity to contribute to India's long-term industrial advancement by establishing local production facilities.
The scheme, notified on December 15, 2025, carries a total financial outlay of ₹7,280 crore. This includes ₹6,450 crore allocated for sales-linked incentives tied directly to the production and sale of rare earth permanent magnets. An additional ₹750 crore is designated as a capital subsidy to support the setup of an aggregate manufacturing capacity of 6,000 metric tonnes per annum.
Scheme Duration and Incentives
According to the Ministry of Heavy Industries, the program is slated to run for seven years from the date of award. This period encompasses a two-year gestation phase for establishing integrated REPM manufacturing facilities, followed by five years of incentive disbursement contingent on sales performance.
During a stakeholder consultation, industry representatives showcased their technological strengths and manufacturing strategies. Several attendees expressed keen interest in participating in the scheme, signaling both domestic readiness and international interest in partnering with India. This initiative is part of a broader governmental push to reduce import dependence and position India as a key player in the global REPM value chain.
The effort is critical for sectors such as electric mobility, renewable energy, electronics, and defence, which rely heavily on these advanced materials for technological self-sufficiency.
