‘Working on it’: India eyes rare earth magnet self-reliance; incentive scheme likely soon to counter China

India is working to resolve the continued rare earth magnet provide disaster and cut back reliance on China by ramping up home manufacturing and providing incentives, heavy industries minister H D Kumaraswamy mentioned on Tuesday.“We are working on it,” Kumaraswamy informed reporters, including that Hyderabad-based Midwest has dedicated to producing 500 tonnes by the tip of this 12 months and scaling up to 5,000 tonnes subsequent 12 months, as per ET.Rare earth magnets, essential for electrical automobiles, electronics and defence, have confronted provide disruptions following China’s export restrictions. In response, the federal government is planning a devoted incentive scheme to subsidise magnet processing models in India, mentioned officers quoted by ET. These incentives, geared toward offsetting China’s value benefit, are anticipated to be finalised in 15–20 days.Officials concerned within the planning mentioned the scheme could also be despatched to the Union Cabinet for approval if the subsidy outlay crosses Rs 1,000 crore. “Stakeholder consultations are on,” secretary Kamran Rizvi mentioned, including that recommendations have ranged from 20 per cent to 50 per cent subsidy, and remaining choices would comply with a aggressive bidding course of.According to information company PTI, Rizvi confirmed that Indian Rare Earths Ltd has reserves to help manufacturing of 1,500 tonnes of magnets, and famous that precise large-scale output will take round two years. In the meantime, efforts are underway to supply magnets and uncooked supplies from international locations like Japan and Vietnam.Despite earlier issues from automakers over restricted provide, authorities officers informed ET that “as of today, things look better” and no producer has reported manufacturing halts.To ease strain, imports of absolutely assembled magnet elements from China are being permitted beneath current exemptions in auto and EV incentive schemes. A fortnight in the past, 30 auto corporations sought DGFT approval to import magnets from China to keep away from disruptions.Minister Kumaraswamy’s remarks got here shortly after National Security Advisor Ajit Doval met Chinese Foreign Minister Wang Yi in Beijing. A Chinese international ministry spokesperson mentioned the 2 international locations needs to be seen as “partners rather than rivals.”In a associated growth, Kumaraswamy and Mines Minister G Kishan Reddy chaired an inter-ministerial assembly earlier this month to align insurance policies throughout key departments. “This inter-ministerial effort will pave the way for India’s self-reliance in strategic materials,” Kumaraswamy posted on X. Reddy added that beneath the National Critical Mineral Mission, the federal government is adopting a “whole-of-government” method to strengthen the rare earth worth chain.Officials identified that China presently controls over 90 per cent of the worldwide rare earth magnet processing capability, sustaining dominance by retaining magnet costs barely 5 per cent above the uncooked materials value.“China wants to maintain its monopoly by keeping the price of magnets very low,” an Indian official cited by ET mentioned, highlighting the necessity for subsidy-backed home options.