Will India Start Producing Rare Earth Magnets Domestically in 15–20 Days? Minister Kumaraswamy Responds

The Union government is likely to decide within the next 15–20 days on introducing a subsidy scheme aimed at boosting domestic production of rare earth magnets, a critical component for electric vehicles and advanced electronics.

Union Minister for Heavy Industries H. D. Kumaraswamy confirmed on Tuesday that the ministry is actively working on the proposal.

“Our secretary and our ministry are working on it,” Kumaraswamy said, responding to questions on the proposed incentive scheme.

When asked if any homegrown player has evinced interest, he stated, “One Hyderabad-based company... they are showing interest. They have promised that they will deliver 500 tonnes by this year-end, December. We have (had) discussions with the Mines Minister. Our secretary and our ministry are working on [it]; ultimately, a decision will be taken.”

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According to Kamran Rizvi, Secretary at the Ministry of Heavy Industries, stakeholder consultations are currently underway to finalize the structure and quantum of incentives.

“If the total outlay exceeds Rs 1,000 crore, the proposal will be placed before the Union Cabinet for final approval,” Rizvi said.

When queried further on the scheme, he noted, “We do not know the quantum of subsidy required yet. Stakeholder consultations are on, as the minister pointed out, so varied responses have come. Somebody wants 50 per cent, somebody wants 20 per cent, so it will be subject to a competitive bid—then we will know the quantum of support required."

Media reports, citing a government official, have suggested that India has firmed up a Rs 3,500–5,000 crore scheme to incentivize production of rare earth minerals and derived magnets in the country, which could be approved in a fortnight.

The move comes amid growing global competition for rare earth resources and India’s broader push to localize key inputs for electric vehicle manufacturing, defence equipment, and clean energy technologies.

At present, China produces 60% of the world’s rare earth elements and controls around 90% of the global refining capacity.