India Rare Earth Magnets Scheme 2025: India is taking strong steps to become self-reliant in rare earth magnet production. The central government has planned a ₹1,345 crore scheme to support Indian companies in producing rare earth magnets locally. These magnets are important parts used in electric vehicles, smartphones, wind turbines, and defence equipment. Right now, India imports most of these magnets from China, but with this new scheme, the goal is to reduce this heavy dependence.
The move comes after China tightened its export rules, making it harder for other countries to get rare earth materials. Several Indian companies like Mahindra & Mahindra, Uno Minda, and Sona Comstar have shown interest in setting up local production. The government plans to give financial support and policy help to companies that produce magnets completely within India.
What is India Rare Earth Magnets Scheme?
The India Rare Earth Magnets Scheme is a government plan worth ₹1,345 crore that supports the domestic production of rare earth magnets. These magnets are key components in electric vehicles, electronics, and defence. The scheme aims to help Indian companies create full in-house facilities — from mining rare earth minerals to processing and manufacturing the final magnets.
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Objective of the Scheme
The main goal of the India Rare Earth Magnets Scheme is to:
- Cut down India’s dependence on China for rare earth magnets.
- Boost domestic manufacturing of rare earth magnets used in defence, EVs, and electronics.
- Secure the country’s critical supply chain.
- Support private and public sector companies in setting up local manufacturing units.
Overview of India Rare Earth Magnets Scheme 2025
| Scheme Name | India Rare Earth Magnets Scheme |
| Launched By | Ministry of Heavy Industries |
| Scheme Budget | ₹1,345 Crore |
| Aim | Domestic production of rare earth magnets |
| Key Sectors Benefiting | Defence, Electric Vehicles, Electronics |
| Participating Ministries | Ministry of Heavy Industries, Ministry of Mines |
| Leading Companies Involved | Mahindra, Uno Minda, Sona Comstar |
| Current Status | Under inter-ministerial review |
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India Explores Rare Earth Options
India imports over 80% of its rare earth magnets from China, which controls over 90% of global magnet processing. With recent export restrictions by China, India is facing supply issues, especially in EV and electronics sectors.
However, India is not short on resources. It has the third-largest reserve of rare earth minerals in the world with around 6.9 million tonnes. Despite this, the country has yet to fully tap into its potential. The government is now working with Indian Rare Earths Limited (IREL) and other stakeholders to ramp up mining and processing. The new scheme is expected to push this effort forward.
Indian Companies Show Interest in Domestic Magnet Production
- Many Indian companies are now stepping forward to join this mission.
- Mahindra & Mahindra is interested in building magnet production capabilities to support its electric SUV range.
- Uno Minda, a supplier to carmakers like Maruti Suzuki, has shown similar interest.
- Sona Comstar was the first to announce plans for local production of rare earth magnets.
These companies are in talks with the Ministry of Heavy Industries and may receive support under the scheme. The government will offer incentives to firms that carry out end-to-end magnet production — from rare earth oxide to the final product.
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Benefits of India Rare Earth Magnets Scheme
- Reduces Import Dependence: Cuts India’s reliance on China for critical materials.
- Boosts Self-Reliance: Encourages local industries and supports the Make in India initiative.
- Strengthens Supply Chain: Ensures steady supply of magnets for auto, tech, and defence sectors.
- Attracts Investment: Encourages both public and private players to invest in advanced manufacturing.
- Creates Jobs: New production units will open up job opportunities across the country.
Applications of Rare Earth Magnets
Rare earth magnets are powerful and small, making them useful in several modern technologies:
- Electric Vehicles: Used in motors and braking systems.
- Smartphones and Electronics: For speakers, vibration units, and more.
- Wind Turbines: Help improve efficiency and power output.
- Defence: Used in missile guidance, radar systems, and communication tools.
- Medical Devices: Found in MRI machines and surgical tools.
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FAQs – India Rare Earth Magnets Scheme 2025
What is the India Rare Earth Magnets Scheme?
The India Rare Earth Magnets Scheme is a ₹1,345 crore government initiative to promote local production of rare earth magnets.
Why is this scheme important?
It helps reduce India’s dependence on China and supports critical sectors like defence, EVs, and electronics.
Which companies are involved in the scheme?
Companies like Mahindra & Mahindra, Uno Minda, and Sona Comstar have shown interest in producing magnets locally.
Who is managing the India Rare Earth Magnets Scheme?
The Ministry of Heavy Industries is leading the scheme with support from the Ministry of Mines and other departments.
What will companies need to qualify for incentives?
To get incentives, companies must carry out full processing from raw materials to finished magnets within India.