India’s Journey Towards Rare Earth Magnet Independence

India’s Plan to Cut Down on Chinese Imports

This is an AI-generated image, used for representational purposes only.

India is making moves to solve the rare earth magnet supply problem. The plan is to increase local production and reduce dependence on China. Heavy Industries Minister H D Kumaraswamy recently shared this news.

Boosting Local Production

Kumaraswamy said, “We are working on it.” He mentioned that Midwest, based in Hyderabad, has promised to produce 500 tonnes by the end of this year. They aim to increase this to 5,000 tonnes next year.

Why Rare Earth Magnets Matter

Rare earth magnets are crucial for:

• Electric vehicles
• Electronics
• Defense equipment

However, supply issues have arisen due to China’s export limits. To tackle this, the government is planning a scheme to support magnet processing units in India.

Government Support

These incentives will help match China’s cost benefits. Officials expect to finalize the scheme in 15-20 days. If the subsidy exceeds Rs 1,000 crore, it may need Union Cabinet approval.

Secretary Kamran Rizvi noted that they are talking to stakeholders. Subsidy suggestions range from 20% to 50%. Final decisions will come after a competitive bidding process.

Production and Sourcing

Indian Rare Earths Ltd has reserves to produce 1,500 tonnes of magnets. But large-scale production will take about two years. Meanwhile, India is looking to source magnets and raw materials from countries like Japan and Vietnam.

Current Supply Update

Despite earlier worries from automakers, officials say the supply situation is getting better. No manufacturer has stopped production. To reduce pressure, imports of fully assembled magnet components from China are allowed under current exemptions.

Teamwork Across Ministries

Minister Kumaraswamy and Mines Minister G Kishan Reddy led a meeting between ministries earlier this month. The goal was to align policies across key departments. Kumaraswamy said, “This teamwork will pave the way for India’s self-reliance in strategic materials.”

Reddy added that the government is using a “whole-of-government” approach. This aims to strengthen the rare earth value chain under the National Critical Mineral Mission.

China’s Market Control

China currently controls over 90% of the world’s rare earth magnet processing capacity. An Indian official pointed out, “China wants to keep its monopoly by keeping magnet prices very low.” This highlights the need for subsidy-backed local alternatives.