Incentive scheme worth Rs 1,345 Cr proposed for rare earth magnets production in India
The proposed scheme comes in the wake of China restricting exports of rare earth magnets that has hit global supplies, impacting EV makers, including in India.
Inter-ministerial consultations are underway for a Rs 1,345 crore scheme to subsidise production of rare earth magnets in India with two select manufacturers proposed to be given incentives, Union Heavy Industries Minister HD Kumaraswamy said on Friday.
The proposed scheme comes in the wake of China restricting exports of rare earth magnets that has hit global supplies, impacting EV makers, including in India.
It will provide end-to-end support for conversion of rare earth oxides into magnets.
The proposal may be sent to the Union Cabinet for approval once the inter-ministerial consultations are completed, sources said.
"(The) Rs 1,345 crore scheme has (proposed) two manufacturers," Kumaraswamy said in response to a query while addressing a press conference here.
Secretary in the Heavy Industries Ministry Kamran Rizvi shared that a Rs 1,345 crore scheme has been circulated which envisages "end-to-end" support to two manufacturers for conversion of rare earth oxides into magnets, which is under inter-ministerial consultation.
"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.
The subsidy will facilitate investment for establishing processing facilities for companies to convert rare earth oxides into magnets. Indian Rare Earth Magnets Ltd, a PSU under the Ministry of Atomic Energy, is the sole repository of rare earths in India.
China's recent restriction on exports of key metals caused widespread disruption in the manufacturing of automobiles and semiconductor chips in a host of countries, including India.
Rare earth magnets include neodymium-iron-boron (NdFeB). It is used for high-performance automotive applications such as traction motors in electric vehicles (two-wheelers and passenger vehicles) and power steering motors (in passenger vehicles) in both electric vehicles and internal combustion engine vehicles.