India to Triple Rare Earth Magnet Incentives to Rs 700 Billion

04 Nov 2025 CW Team

The proposal, which awaits Cabinet approval, represents a sharp increase from the earlier Rs 240 billion ($290 million) plan aimed at securing critical materials for the electric vehicle, renewable energy and defence sectors. The final allocation, however, could still be revised, the officials added.

The expansion aligns India with global efforts to diversify rare earth supply chains following China’s move to tighten export controls earlier this year, disrupting supplies for automakers worldwide. China currently processes about 90 per cent of global rare earth output.

Prime Minister Narendra Modi has previously stressed the need to prevent “weaponisation” of critical minerals and promote diversified, stable supply chains. However, India’s push faces challenges including limited domestic expertise, funding constraints and long project timelines.

Under the proposed scheme, around five companies are expected to benefit from a mix of production-linked and capital subsidies. The government is also funding research into synchronous reluctance motors — an emerging technology that could reduce dependence on rare earth materials.

Currently, no Indian-origin firms have received import licences for rare earth magnets from China, though a few foreign suppliers have shown interest in providing materials to India. The country’s annual demand for rare earth oxides stands at around 2,000 tonnes — a volume global producers can readily supply.

India hopes that an expanded incentive package will attract global magnet manufacturers to establish local subsidiaries or joint ventures, strengthening the country’s position in critical mineral value chains and reducing its reliance on Chinese imports.

Analysts caution, however, that India’s plan could face headwinds if China eases export restrictions for the US and European Union, as lower global prices might discourage long-term investments in India’s emerging rare earth sector.

India is set to nearly triple its incentive programme for rare earth magnet manufacturing to more than Rs 700 billion (approximately $788 million) as it looks to strengthen domestic capacity in a sector currently dominated by China, according to officials familiar with the matter.The proposal, which awaits Cabinet approval, represents a sharp increase from the earlier Rs 240 billion ($290 million) plan aimed at securing critical materials for the electric vehicle, renewable energy and defence sectors. The final allocation, however, could still be revised, the officials added.The expansion aligns India with global efforts to diversify rare earth supply chains following China’s move to tighten export controls earlier this year, disrupting supplies for automakers worldwide. China currently processes about 90 per cent of global rare earth output.Prime Minister Narendra Modi has previously stressed the need to prevent “weaponisation” of critical minerals and promote diversified, stable supply chains. However, India’s push faces challenges including limited domestic expertise, funding constraints and long project timelines.Under the proposed scheme, around five companies are expected to benefit from a mix of production-linked and capital subsidies. The government is also funding research into synchronous reluctance motors — an emerging technology that could reduce dependence on rare earth materials.Currently, no Indian-origin firms have received import licences for rare earth magnets from China, though a few foreign suppliers have shown interest in providing materials to India. The country’s annual demand for rare earth oxides stands at around 2,000 tonnes — a volume global producers can readily supply.India hopes that an expanded incentive package will attract global magnet manufacturers to establish local subsidiaries or joint ventures, strengthening the country’s position in critical mineral value chains and reducing its reliance on Chinese imports.Analysts caution, however, that India’s plan could face headwinds if China eases export restrictions for the US and European Union, as lower global prices might discourage long-term investments in India’s emerging rare earth sector.

Infrastructure Urban

02 Jun 2026

VECV Sales Rise 7.8 Per Cent In May 2026

VE Commercial Vehicles recorded sales of 7,978 units in May 2026, compared to 7,401 units in May 2025, registering growth of 7.8 per cent. This included 7,789 units from the Eicher brand and 189 units from the Volvo brand.Eicher branded trucks and buses reported sales of 7,789 units during the month, up 7.3 per cent from 7,258 units a year earlier. In the domestic commercial vehicle market, Eicher sales rose 9.1 per cent to 7,375 units from 6,758 units in May 2025.Exports declined 17.2 per cent to 414 units from 500 units in the corresponding month last year. Volvo Trucks and Volvo Buses recor..

Infrastructure Urban

02 Jun 2026

Table Space Strengthens DESYN Leadership Team

Table Space has announced strategic leadership appointments within DESYN, its integrated Design and Build business, as it looks to strengthen operations across key enterprise and GCC markets in India. DESYN was launched as a strategic extension of Table Space’s workspace solutions portfolio to meet rising demand for agile, high-quality and rapidly deployable enterprise workspaces.Shruti Ookabhoy has joined DESYN as Executive Director and will lead the Design vertical, focusing on design capability, operational excellence and team development across markets. She brings over 22 years of experi..

Infrastructure Transport

02 Jun 2026

Concord Associate Bags Rs 2.79 Bn Kavach Order

Concord Control Systems said its associate company, Progota India, has received a Rs 2.79 bn domestic order from Indian Railways for the supply, installation, testing and commissioning of on-board Kavach 4.0 loco equipment.The order is scheduled for execution within 12 months and strengthens Concord’s role in India’s railway safety and signalling ecosystem. Kavach is India’s indigenous automatic train protection system, designed to improve operational safety by helping prevent signal passing at danger and reducing collision risks.Gaurav Lath, Joint Managing Director, Concord Control Syst..