REPM Scheme Aims to Build India’s First Integrated Domestic Manufacturing Ecosystem for High-Value Magnets

The Government of India has approved the Scheme to Promote Manufacturing of Sintered Rare Earth Permanent Magnets (REPM) with a total financial outlay of ₹7,280 crore, marking a major step towards strengthening India’s self-reliance in critical materials required for advanced and strategic industries.

The scheme aims to establish India’s first fully integrated domestic manufacturing ecosystem for high-value rare-earth permanent magnets, covering the entire value chain from rare-earth oxides to finished magnets, with a targeted manufacturing capacity of 6,000 metric tonnes per annum (MTPA).

India’s Rare-Earth Resource Base

India possesses a substantial base of rare-earth mineral resources, particularly monazite deposits, which are critical for downstream rare-earth industries such as permanent magnet manufacturing.

These deposits are found in:

• Coastal beach sands

• Teri/red sands

• Inland alluvium

across Andhra Pradesh, Odisha, Tamil Nadu, Kerala, West Bengal, Jharkhand, Gujarat and Maharashtra.

According to official estimates:

• India has about 13.15 million tonnes of monazite, containing approximately 7.23 million tonnes of rare-earth oxides (REO)

• An additional 1.29 million tonnes of in-situ REO resources have been identified in hard-rock areas of Gujarat and Rajasthan

• The Geological Survey of India has further augmented 482.6 million tonnes of rare-earth ore resources through extensive exploration initiatives

These oxides serve as the primary raw material for downstream rare-earth industries, including REPM manufacturing.

Need for the REPM Scheme

Despite having a strong rare-earth resource base, India’s domestic production of permanent magnets remains limited, and a significant share of demand is met through imports.

Official trade data shows that during 2022–23 to 2024–25, India’s dependence on imports from China for permanent magnets ranged between:

• 59.6% to 81.3% (value-wise)

• 84.8% to 90.4% (quantity-wise)

At the same time, India’s REPM consumption is expected to double by 2030, driven by rapid growth in:

• Electric mobility

• Renewable energy deployment

• Electronics manufacturing

• Aerospace and defence applications

This growing demand underscores the need to develop integrated domestic manufacturing capacity to ensure long-term supply-chain resilience and competitiveness.

Key Features of the REPM Scheme

The REPM scheme establishes a comprehensive framework for end-to-end manufacturing of rare-earth permanent magnets in India.

Key elements include:

• Creation of 6,000 MTPA integrated REPM manufacturing capacity, spanning from oxide feedstock to finished magnets

• Allocation of capacity among up to five beneficiaries through a global competitive bidding process

• Each beneficiary eligible for up to 1,200 MTPA, ensuring diversification while maintaining scale

• ₹6,450 crore earmarked as sales-linked incentives over a five-year period

• ₹750 crore capital subsidy to support establishment of advanced manufacturing facilities

The scheme will be implemented over seven years, comprising:

• Two-year gestation period for setting up integrated facilities

• Five years of incentive disbursement, linked to actual REPM sales

This structured timeline is designed to support timely capacity creation, market development, and operational stability.

What Are Rare Earth Permanent Magnets (REPMs)?

Rare Earth Permanent Magnets are among the strongest types of permanent magnets, offering high magnetic strength and stability in compact sizes.

They are essential components in:

• Electric vehicle motors

• Wind turbine generators

• Consumer and industrial electronics

• Aerospace and defence systems

• Precision sensors and actuators

Their ability to deliver high performance in small form factors makes REPMs indispensable for advanced engineering and high-technology applications.

Alignment with National Priorities

The REPM scheme directly supports several national objectives, including:

• Atmanirbhar Bharat (self-reliance in critical inputs)

• Viksit Bharat by 2047

• Net Zero emissions target by 2070

Rare-earth magnets play a central role in energy-efficient motors, wind-power systems and green technologies, aligning the initiative with India’s clean-energy transition.

From a national security perspective, REPMs are vital for defence and aerospace systems, making domestic production crucial for strategic autonomy and indigenisation.

Integration with Critical Minerals Strategy

The scheme complements India’s broader efforts to strengthen its critical minerals value chain, particularly under the National Critical Minerals Mission (NCMM), approved in January 2025.

NCMM aims to secure a long-term sustainable supply of critical minerals across the entire value chain—from exploration and mining to processing, beneficiation and recycling.

Key policy reforms supporting this effort include amendments to the Mines and Minerals (Development and Regulation) Act, 1957, through the MMDR Amendment Act, 2023, which:

• Introduced a dedicated list of critical and strategic minerals

• Enabled auction of mining leases and composite licences

• Opened all stages of mineral exploration to private participation

• Introduced a new exploration licence regime for deep-seated and critical minerals

Global Engagement and Supply Security

Recognising the vulnerability of global rare-earth supply chains, the Ministry of Mines has entered into bilateral agreements with mineral-rich countries, including:

• Australia

• Argentina

• Zambia

• Peru

• Zimbabwe

• Mozambique

• Malawi

• Côte d’Ivoire

India also participates in multilateral platforms such as:

• Minerals Security Partnership (MSP)

• Indo-Pacific Economic Framework (IPEF)

• Initiative on Critical and Emerging Technologies (iCET)

Additionally, Khanij Bidesh India Limited (KABIL)—a joint venture of NALCO, HCL and MECL—is actively pursuing overseas exploration and acquisition of strategic mineral assets, including lithium and cobalt, particularly in Argentina.

Conclusion

The Scheme to Promote Manufacturing of Sintered Rare Earth Permanent Magnets (REPM) represents a strategic, technology-driven intervention to:

• Reduce import dependence

• Strengthen supply chains for high-growth sectors

• Attract advanced manufacturing investment

• Generate employment

• Support India’s clean-energy and industrial transformation

By establishing a robust domestic REPM ecosystem and integrating it with broader critical-mineral and industrial strategies, the initiative positions India to emerge as a key global player in advanced materials, while advancing the vision of Atmanirbhar Bharat and Viksit Bharat @2047.

Source: PIB