India is set to enhance its production of rare earth magnets to lessen dependence on Chinese supplies, as announced by Union Minister HD Kumaraswamy.
India is preparing a major push to strengthen its rare earth magnet production and reduce reliance on Chinese rare earth supplies, Union Heavy Industries and Steel Minister HD Kumaraswamy announced on Friday. The government is designing a fiscal incentive scheme that will support local manufacturers in producing magnets critical for electric vehicle (EV) motors, power steering units, and advanced auto components.
- EV traction motors
- Hybrid and combustion vehicle power steering systems
- Advanced auto components and semiconductor devices
With China controlling more than 80% of global rare earth magnet supply, India faces a strategic challenge in securing steady supplies for its fast-growing EV and auto industries.
- Financial support for capital investment and operating costs
- Relief from high tariffs on imported processing equipment
- A roadmap for Rs 1,345 crore program to back at least two domestic manufacturers in setting up facilities to convert rare earth oxides into usable magnets
Kumaraswamy emphasized, “Rare earth magnets are central to the EV revolution. To safeguard India’s supply chain and reduce dependence on China, we are preparing incentives to encourage domestic production.”
- The government aims to bridge cost gaps and attract investors to India’s rare earth sector.
- Plans align with India’s EV policy 2030 and the country’s vision to emerge as a global EV manufacturing hub.
- Rare earth localization will also help India mitigate risks from global trade restrictions and boost its role in global value chains.