The Ministry of Heavy Industries has moved a step closer to localising rare earth permanent magnet production, with Union Minister H.D. Kumaraswamy chairing a stakeholder consultation on the Scheme to Promote Manufacturing of Sintered Rare Earth Permanent Magnets (REPMs). The scheme, notified on December 15, 2025, provides total financial support of ₹7,280 crore to establish domestic manufacturing capacity of 6,000 metric tonnes per annum. It combines sales-linked incentives and capital subsidies to attract investments from both Indian and global players.
Rare earth permanent magnets are a core component in electric vehicles, wind turbines, consumer electronics, and defence equipment. The scheme is designed to reduce India’s reliance on imports while strengthening domestic capabilities in strategically important materials.
Incentive structure and implementation timeline
The scheme offers ₹6,450 crore in sales-linked incentives and ₹750 crore in capital subsidies. It follows a seven-year implementation framework, including a two-year gestation period for setting up manufacturing facilities and five years of incentive disbursement linked to sales performance. The Ministry of Heavy Industries is currently finalising the Request for Proposal documentation ahead of the bidding process.
During the consultation, the Joint Secretary of the ministry outlined the structure, eligibility criteria, and key features of the scheme. Minister Kumaraswamy encouraged participation from eligible domestic and international companies to support India’s long-term industrial growth.
Industry participation and strategic importance
The meeting was attended by senior officials from the Ministry of Heavy Industries and the Department of Atomic Energy, along with executives from IREL (India) Ltd., NMDC, and NFTDC. Industry representatives shared their technical capabilities and expressed interest in participating in the programme.
Rare earth magnets play a critical role in EV drivetrains and renewable energy systems, making them central to India’s clean energy transition. The initiative aligns with the Viksit Bharat @2047 vision by aiming to secure supply chains for strategic materials and enhance India’s position in advanced manufacturing.
