Overview

• China’s April 2025 export controls on rare earth magnets triggered a severe supply shortfall that threatened India’s EV, electronics and defence output.
• The incentive fund of Rs 1,345 crore will subsidize end-to-end processing from ore extraction to finished magnets with support earmarked for two manufacturers.
• Concept guidelines have been circulated to heavy industries, mines, finance, atomic energy and NITI Aayog ministries as part of inter-ministerial consultations.
• Original equipment makers Mahindra & Mahindra, Uno Minda and Sona BLW Precision Forgings have confirmed interest in establishing local magnet-making facilities.
• Cabinet approval is expected imminently as New Delhi seeks to curb reliance on Chinese imports and expand its own rare earth capacity.