There is still no definite resolution on China’s curb on the export of rare earth minerals. As a result, reports indicate that the Indian government is planning to invest about Rs 1,000 crore to incentivize domestic production of rare earth magnets.
According to a CNBC-TV18 report, India’s Ministry of Heavy Industries and Department of Atomic Energy are working on a scheme with a budget of Rs 1000 crore to incentivize rare earth magnet production.
The rare earth magnet manufacturing scheme could be finalized within the coming 10- 15 days, says the CNBC TV-18 report. The scheme is aimed at producing about 1500 tonnes of rare earth magnets in India. While the government hasn’t yet fully disclosed the scheme, five to six companies have shown their interest in entering the rare earth magnet manufacturing sector, says the report.
Why is the scheme important
Rare earth magnets are a key component in the automobile and renewable energy industry. China dominates the global supply of the rare earth minerals, and recently, it curbed the exports of the rare earth minerals, leading to a heavy shortage of rare earth minerals in the Indian Industry.
To reduce its dependence on Chinese exports, the government has decided to boost the domestic production of the rare earth magnets. India Rare Earth Limited will play a significant role in fulfilling the rare earth magnets requirements of the Industry, as it is expected to supply about 500 tonnes of raw materials to the Original Equipment Manufacturers.
Govt scheme for rare earth minerals
While the government is expected to invest Rs 1500 crore to boost rare earth magnets production, it is also working on a scheme to increase domestic production of other rare earth minerals as well.
According to a report by the Times of India, the government is planning to invest Rs 3500-5000 crore to incentivise the production of rare earth minerals. Currently, the government is working on an internal assessment to plan to commence the productions in the shortest possible time.