Cabinet Approves ₹7,280 Crore Mega Plan for Rare Earth Permanent Magnet Manufacturing in India

The Indian government has approved a ₹7,280 crore scheme to develop domestic Rare Earth Permanent Magnet (REPM) manufacturing capacity. The initiative aims to make India self-reliant in REPM, reduce import dependence, and position the country as a major global player in EVs, electronics, defense, and renewable energy sectors.

Cabinet Approves Mega REPM Scheme

Under the leadership of Prime Minister Narendra Modi, the Indian Cabinet has approved a historic ₹7,280 crore mega plan to develop domestic Rare Earth Permanent Magnet (REPM) manufacturing. With this scheme, India will join the ranks of the world’s leading REPM producers.

The plan targets the creation of an integrated REPM production capacity of 6,000 metric tons annually. Currently, most of India’s REPM demand is met through imports. Once implemented, India will become self-reliant and a significant player in the global supply chain.

Boosting Domestic REPM Capacity

The scheme aims to meet India’s domestic REPM requirements and enable future exports. Key objectives include:

• Establish 6,000 MT annual production capacity

• Reduce import dependence

• Support EVs, electronics, and defense sectors

• Increase India’s share in the global technology supply chain

What are Rare Earth Permanent Magnets and Their Importance?

Rare Earth Permanent Magnets (REPMs) are considered some of the strongest magnets in the world. Made from elements like neodymium and samarium, they are widely used in:

• Electric vehicles (EV motors)

• Wind turbines

• Aerospace applications

• Defense systems

• Mobile phones, laptops, and consumer electronics

• Robotics and medical machinery

With India’s EV sector growing rapidly, demand for REPMs is expected to double over the next five years.

Sintering Technology: How REPMs Are Made

The production of sintered REPM involves several high-precision steps:

1. Rare Earth Oxides are converted into metal.

2. Metals are alloyed.

3. The alloy is powdered and heat-compressed.

4. A solid magnet is produced.

This high-tech and precision-driven process is performed by very few countries worldwide.

Growing Demand in India

Between 2025 and 2030, India’s REPM consumption is projected to double due to:

• The EV boom

• Expansion of renewable energy projects

• Rising electronics demand

• Increased investment in defense and aerospace

Currently, a large portion of India’s REPM requirements is imported from China and other countries.

Selection of 5 Companies

The government will select 5 companies through a global competitive bidding process.

Each selected company will receive:

• 1,200 MT annual production capacity

• Incentives for 5 years

• Capex support

• Collaboration in technology and R&D

The scheme prioritizes companies that can advance India’s micro-mobility and high-end manufacturing sectors.

Scheme Duration: 7 Years

The overall duration of the scheme is 7 years:

• 2 years for setting up units

• 5 years for production-based incentives

This will elevate India’s REPM production to a new level.

Sectors Benefiting from REPM Production

• Electric Vehicles (EV sector)

• Renewable Energy (Wind & Solar tech)

• Defense technology

• Aerospace

• Consumer electronics

• Medical devices

• High-power motors and robotics

The scheme will help create a robust domestic value chain across these sectors.

Global Impact for India

• India becomes a net producer of REPMs

• Ability to supply global companies

• Reduced dependence on China

• Establish India as a major production hub in Asia

• Strengthen strategic sectors and self-reliance

Economic Impact

• Generation of thousands of new jobs

• Strengthened MSME supply chains

• Boost to high-tech manufacturing

• Potential for large exports

• Attraction of foreign investment

Conclusion

The Cabinet’s approval of the ₹7,280 crore REPM manufacturing scheme is a game-changer for India. It positions the country as a global player in Rare Earth Magnet production, supports high-tech industries like EVs, defense, electronics, and renewable energy, and sets the stage for India to achieve self-reliance and global market leadership in strategic manufacturing sectors.