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India is planning to nearly triple its incentive program for rare earth magnet manufacturing to over ₹7,000 crore ($788 million).
Context: the global rare earth market is still dominated by China, which controls nearly 90% of processing capacity.
China’s export restrictions earlier this year disrupted supplies worldwide, especially for automakers, and exposed the world’s reliance on a single source. Mining and processing rare earths also remain tough due to high costs and environmental challenges.
What’s the matter: the new plan, awaiting cabinet approval, marks a sharp increase from the earlier $290 million proposal.
India is now joining global efforts to diversify rare earth supply chains and cut dependence on China. PM Modi has repeatedly warned that critical minerals must not be weaponized, calling for stable, diversified access to these resources.
Why it’s needed: the initiative aims to secure key materials essential for electric vehicles, renewable power systems, and defence technology.
It will support around five companies through a mix of production-linked incentives and capital subsidies. Meanwhile, state-run firms are leading efforts to build global mining partnerships as domestic production remains unviable without government support.
