Relevance for UPSC: GS Paper III (Economy, Industry, Energy Security, Resources)
Source: Press Information Bureau; Ministry of Mines and Ministry of Heavy Industries

Key Takeaways

  • REPMs are foundational to India’s EV and renewable energy push.
  • The scheme shifts India from raw resource ownership to value-chain leadership.
  • Critical minerals have become central to India’s strategic economic planning.

Context

India has approved a ₹7,280 crore scheme to establish a domestic, integrated manufacturing ecosystem for Sintered Rare Earth Permanent Magnets (REPMs). These magnets are a strategic input for electric vehicles, wind energy, electronics, aerospace and defence, making the initiative crucial for Atmanirbhar Bharat, Net Zero 2070, and critical minerals security.

Why REPMs Matter

Rare Earth Permanent Magnets are valued for their high magnetic strength, compact size and energy efficiency. They are indispensable for:

  • EV traction motors
  • Wind turbine generators
  • Precision electronics and sensors
  • Defence and aerospace applications

With rapid growth in EVs and renewables, REPM demand is expected to double by 2030.

India’s Key Challenge

  • India has significant rare-earth resources (especially monazite deposits).
  • Yet, it is heavily import dependent, largely on China, for finished magnets.
  • This exposes India to geopolitical risks, supply disruptions and cost volatility, particularly in clean energy and defence sectors.

Key Features of the Scheme

  • 6,000 MTPA integrated capacity covering the full value chain (oxide → magnet).
  • Support to up to five manufacturers, capped at 1,200 MTPA each.
  • Sales-linked incentives of ₹6,450 crore and capital support of ₹750 crore.
  • Seven-year implementation period (2-year setup + 5-year incentives).

Policy and Strategic Alignment

  • Anchored in the National Critical Minerals Mission.
  • Enabled by MMDR Act amendment, 2023, allowing private participation.
  • Supports defence indigenisation, clean energy transition, and industrial competitiveness.
  • Strengthens India’s position in global advanced-material value chains.

India’s REPM initiative marks a decisive move towards strategic self-reliance in advanced materials.

UPSC Value Box

Why this issue matters:

  • Enhances energy security and reduces import dependence in critical sectors.
  • Integrates industrial policy with climate goals and national security.

Key challenge & way forward:

  • Challenge: Technology gaps and global supply concentration.
  • Way forward: Combine domestic manufacturing with overseas mineral partnerships and sustained research support.

Q. “Examine how the Rare Earth Permanent Magnet manufacturing scheme strengthens India’s clean energy transition and critical minerals security.”

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