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Key Points

The Indian government has proposed a Rs 1,345 crore subsidy scheme to boost domestic Rare Earth magnet production. Both private and public sector manufacturers, including Mahindra and Uno Minda, are likely to benefit. The move comes as China restricts exports, impacting global supply chains. Rare Earth magnets are crucial for EVs, wind turbines, and high-tech devices.

Key Points: India Plans Rs 1,345 Crore Rare Earth Magnets Subsidy Scheme

  • Rs 1,345 crore subsidy to boost Rare Earth magnet production
  • Scheme covers private and public sector manufacturers
  • Mahindra & Uno Mida show interest in domestic production
  • China's export curbs push India to reduce dependency
2 min read

Centre plans Rs 1,345 crore subsidy scheme to boost production of Rare Earth magnets

India offers Rs 1,345 crore subsidy to boost domestic Rare Earth magnet production, targeting EV and tech sectors amid China export curbs.

"We are interested in magnets. Anybody who gives us magnets will get incentive. – Kamran Rizvi"

New Delhi, July 11

The Indian government has drawn up a scheme to offer subsidies to the tune of Rs 1,345 crore for manufacturers of Rare Earth magnets in the country, Union Minister of Heavy Industry, H.D. Kumaraswamy said on Friday.

"A scheme has been circulated for Rs 1,345 crore subsidy for manufacturers of Rare Earth magnets. It is currently under inter-ministerial consultation. It is proposed that there will be two manufacturers as of now, however, this could change by the time the scheme is ready," the minister said.

Secretary, Ministry of Heavy Industry, Kamran Rizvi said manufacturers engaged in end-to-end processing from Rare Earth oxides to magnets will be eligible for the subsidy. The incentives proposed in the scheme are expected to cover both private and public sector companies.

“We are interested in magnets. Anybody who gives us magnets will get incentive. This (Rs 1,345 crore scheme) is the first outline we have sent for inter-ministerial consultation. It is proposed that there will be two manufacturers," Rizvi said.

Homegrown automaker Mahindra & Mahindra and auto components manufacturer Uno Minda are two companies that have expressed an interest in setting up facilities for domestic magnet production.

During a meeting with the Ministry of Heavy Industries in June, Mahindra proposed that the company could either partner with an established producer or enter a long-term supply agreement with a local manufacturer. The company is among the leading electric vehicle manufacturers in the country.

Uno Minda supplies auto components to auto manufacturers such as Maruti Suzuki.

China has imposed restrictions on the exports of Rare Earth magnets in retaliation against the US tariff hikes and is using the commodity as a bargaining chip in the trade war. This has also had an impact on other countries that are dependent on Chinese imports.

Rare Earth magnets are used in a variety of high-tech applications, ranging from electronic goods and electric vehicles to large-scale industrial equipment.

These magnets are crucial in electric motors, particularly in electric vehicles and wind turbines, due to their ability to generate strong magnetic fields with a small size. They also find widespread use in computer hard drives, loudspeakers, headphones, and medical devices like MRI scanners.

- IANS

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Reader Comments

P
Priyanka N
₹1345 crore seems like a huge amount for just 2 manufacturers. Why not spread it across more companies to create healthy competition? Also worried about transparency in selection process.
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Aditya G
As an engineer working in EV sector, this is much needed! Rare earth magnets are the backbone of electric motors. Currently paying premium for imports. Domestic production will cut costs by 30-40% 👍
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Sarah B
Good initiative but hope they consider environmental impact too. Rare earth mining can be very polluting. The scheme should mandate proper waste management and recycling processes.
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Karthik V
Mahindra and Uno Minda are good choices. They have the scale and technical expertise. This will help India become self-reliant in EV components. China's export restrictions were a wake-up call!
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Neha E
Hope this leads to more job opportunities in manufacturing sector. Also, government should tie subsidies to local R&D - we need to develop our own magnet technologies, not just assemble imported materials.

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