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Union Cabinet Approves INR 7,280 Crore Rare Earth Magnets Manufacturing Scheme

The Union Cabinet has approved a Rs 7,280 crore scheme to establish India’s first integrated manufacturing ecosystem for sintered rare earth permanent magnets (REPMs), targeting 6,000 MTPA capacity. The initiative includes sales-linked incentives (Rs 6,450 crore) and capital subsidies (Rs 750 crore) for five manufacturers selected through a global competitive bidding process.

REPMs are crucial for electric vehicles, renewable energy, electronics, aerospace, and defence. With domestic demand expected to double by 2030, the scheme aims to reduce import dependency, generate employment, and strengthen India’s global competitiveness. Each manufacturer will be allotted up to 1,200 MTPA, with a total scheme duration of 7 years, including a 2-year setup period and 5 years of incentive disbursement.

This marks a strategic step toward self-reliance in critical magnet manufacturing and supports India’s Net Zero 2070 commitment.