India to Triple Rare Earth Magnet Incentive Programme to $788 Million
India plans to nearly triple the funding for its rare earth magnet incentive programme to over $788 million, aiming to boost domestic manufacturing capacity and reduce dependence on China. The expanded plan includes production-linked incentives and subsidies to attract global and domestic investment amid China’s dominant global supply and export restrictions.
India intends to significantly scale up its rare earth magnet incentive programme from the previous $290 million to over $788 million to accelerate domestic production in a market currently dominated by China, which controls about 90% of global rare earth processing. This initiative aims to strengthen India's supply chain for rare earth magnets critical for electric vehicles, renewable energy, and defense sectors, especially following China's export restrictions amidst trade tensions with the US. The government plans to support around five companies through production-linked incentives and capital subsidies to stimulate local manufacturing and attract foreign investors. India also faces challenges including technical expertise gaps, environmental regulations related to mining, and costly production without subsidies. Parallel research investment in emerging motor technologies intends to reduce reliance on rare earth materials. The expansion is part of broader global efforts by countries like the US, Japan, and the EU to reduce dependency on China's supply chain. The success of India’s push may still be influenced by potential changes in China’s export policies and global market dynamics.
