Centre green‑lights ₹7,280‑crore “magnet scheme” to end china’s dominance – from Defence to EVs
New Delhi (The Uttam Hindu): The central government on Wednesday took a major and historic decision towards breaking China's monopoly and towards a self-reliant India. The government has approved an ambitious plan worth Rs 7,280 crore to promote the manufacturing of 'Sintered Rare Earth Permanent Magnets' (REPM) in the country. This is the first plan of its kind in India, whose main objective is to establish state-of-the-art magnet factories within the country with a production capacity of 6,000 metric tons per year. This move of the government is being considered strategically very important because future technology is completely dependent on these magnets.
It is noteworthy that China has so far dominated the market for rare earth permanent magnets. A recent ban on their exports disrupted global supply chains, directly impacting the automobile and electronics industries. These magnets are considered among the most powerful magnets in the world. They are used in electric vehicles (EVs), solar and wind energy projects, mobile phones, aerospace, defense equipment, missile technology, and medical devices such as MRI machines. To reduce dependence on China, India has decided to begin domestic production.
The financial framework for this scheme has been significantly strengthened. Out of a total budget of ₹7,280 crore, the government will provide ₹6,450 crore as sales-based incentives and ₹750 crore as capital subsidy. The aim is to establish the entire value chain from rare earth oxides to finished magnets in the country. The total duration of the scheme has been set at seven years, with the first two years dedicated to setting up the plant and the next five years dedicated to providing sales incentives. Five companies will be selected through a global competitive bidding process and each will be allocated a maximum capacity of 1,200 tonnes per year.
The Central Government believes that this scheme will prove to be a milestone in achieving the "Atmanirbhar Bharat Mission," the "Net-Zero" target by 2070, and the vision of a "Developed India @ 2047." This will not only bring cutting-edge technology to the country but will also create significant employment. With a strengthened industrial supply chain, India will emerge as a significant player in the global REPM market and ensure its security in strategic sectors.