Government of India has launched plans to address a looming shortage of rare-earth permanent magnets—a critical component for electric vehicles (EVs), wind turbines, electronics, and defense systems. A new scheme is expected to offer fiscal incentives, infrastructure support, and partnerships to build domestic magnet manufacturing capacity.
India’s EV industry is heavily dependent on rare‐earth magnets—especially neodymium-iron-boron (NdFeB) and dysprosium-injected variants—used in high-efficiency permanent magnet motors. But China still controls as much as 90% of rare earth processing and magnet exports, and recent Chinese export curbs have exposed supply fragility.
Government of India is actively planning and allocating funds to support rare-earth magnet production, especially given tightening global supply. Some key developments:
- Under the National Critical Mineral Mission (NCMM), efforts are underway to strengthen exploration, processing, and strategic stocks of critical minerals (including rare earths) from 2024–25 to 2030–31Around ₹7,350 crore has been proposed to create a full value chain for sintered rare-earth magnets.
- A proposal for a ₹1,345 crore incentive scheme to promote domestic manufacturing of rare earth magnets is under inter-ministerial review.
- More decisively, an inter-ministerial panel has cleared a ₹7,300 crore scheme aimed at building an indigenous rare earth permanent magnet ecosystem, covering capital and operational expenditure.
- The government has also introduced PLI (Production Linked Incentive) type schemes to attract private players to magnet production.
Many Indian firms, including Mahindra & Minda (Uno Minda), are already eyeing local magnet production to reduce dependence on China’s supply chain dominance. Reuters recently reported that Mahindra and parts supplier Uno Minda are exploring domestic rare earth magnet manufacturing to bypass import risks.
Meanwhile, Sona Comstar, historically India’s largest importer of rare-earth magnets, has declared plans to begin local manufacturing in line with the government’s push.
India’s state-owned IREL (India) Limited plans a REPM (Rare Earth Permanent Magnet) plant at Visakhapatnam, using indigenous technology to produce high-value magnets domestically.
On the manufacturer side, several Indian firms are already active or primed in the magnet space: Kumar Magnet Industries is known for producing NdFeB magnets domestically. Other manufacturers include Ashvini Magnets, Dura Magnets, Magnetic Solutions, Ali Magnet, among others listed in supplier directories.
If India succeeds in scaling magnet production, it could dramatically reduce import risk for its burgeoning EV sector, stabilize component costs, and give domestic OEMs more control over their supply chains. But challenges remain—magnet manufacturing is capital and technology intensive, involves hazardous chemistry, and needs consistent scale. It will require deep collaboration across government, industry, and research institutions.
This push marks more than a reaction to supply stress—it is a strategic move toward resource sovereignty in India’s energy and mobility future.
