India Unveils ₹5,000 Crore Plan to Boost Rare Earth Production and Cut Import Dependence – EQ
In Short : India has finalized a ₹5,000 crore incentive scheme to boost domestic production of rare earth minerals and magnets, aiming to reduce reliance on Chinese imports. Part of the National Critical Mineral Mission, the plan includes subsidies, export curbs, and a ₹1,500 crore recycling initiative. It targets strengthening India’s supply chain for EVs, renewables, and high-tech industries.
In Detail : India has finalized a ₹5,000 crore incentive scheme to promote domestic production of rare earth minerals and their derived products, such as magnets. The proposal is expected to receive formal approval within two weeks as part of the government’s broader strategy to strengthen its critical minerals supply chain.
This initiative falls under the National Critical Mineral Mission, which aims to secure essential raw materials for India’s clean energy and high-tech industries. The move comes amid tightening global supply chains, particularly after China imposed restrictions on rare earth exports, impacting sectors like electric vehicles and electronics.
Although India ranks fifth globally in rare earth reserves, it currently lacks the processing infrastructure and depends heavily on imports—mainly from China. The new scheme includes production-linked incentives and subsidies to make Indian-made rare earth products cost-competitive with global alternatives.
To prioritize domestic needs, the government has directed state-run Indian Rare Earths Limited (IREL) to suspend exports. The focus is on developing local capabilities for mining, processing, and manufacturing, particularly in rare earth magnets critical for motors, wind turbines, and defense applications.
A complementary ₹1,500 crore recycling scheme is also being prepared. This initiative will support the recovery of valuable minerals like neodymium, dysprosium, terbium, and samarium from industrial scrap and mining waste, further reducing import dependence and improving resource efficiency.
These efforts are part of the ₹34,300 crore National Critical Mineral Mission, which encompasses exploration, overseas asset acquisition, processing hubs, and recycling infrastructure. Through this mission, India aims to become self-reliant in critical minerals, support its green transition, and emerge as a global player in the clean energy economy.
