Rare earth corridors to boost country's self-reliance in magnets, says industry

While presenting the Union Budget 2026-27 in the Lok Sabha, Finance Minister Nirmala Sitharaman said, It is proposed to provide basic customs duty exemption to the import of capital goods required for processing of critical minerals in India. She noted that a Scheme for Rare Earth Permanent Magnets was launched in November 2025.

Budget proposals on dedicated rare earth corridors in mineral-rich states like Odisha will spur the development of new technologies for manufacturing of rare earth magnets used in phones, defence, EVs and other modern equipment, industry players said on Sunday. ''Today's budget highlighted on creating Rare Earth Corridors in Odisha, Tamil Nadu, Kerala & Andhra Pradesh for mining, manufacturing, processing and refining of rare earth and critical minerals. ''This will lead to enhanced focus and development of new technologies for manufacturing of Rare Earth Magnets to be used in phones, defence & space equivalents, EVs and other modern equipment,'' Sanjiv Ganeriwala, Chairman of Mining Council Eastern India, Assocham, said. Also beneficiation and refining of graphite will lead to large battery storage for solar energy and a lot of other industries. A lot of other rare and critical minerals beneficiation and refining will make India self-reliant and a leader in the world, he said. Grant Thornton Bharat Partner and Metals and Mining Industry Suvendu Bose said that the proposed dedicated rare earth corridors aim to integrate mining, processing, R&D, and manufacturing, addressing the weakest link in India's energy transition: value-chain depth. Complemented by customs duty exemptions for capital goods in critical minerals processing, nuclear projects, lithium-ion cells and battery storage systems, and solar glass manufacturing, these measures advance India's strategic self-reliance in minerals and chemicals crucial for EVs, renewables, nuclear power, defence, and advanced manufacturing, Bose said. The Finance Minister Nirmala Sitharam on Sunday also announced import duty exemption on capital goods needed for processing critical minerals to boost mining and processing activities. This assumes significance in view of the government's focus on promoting rare earth or critical minerals to reduce import dependence as these can be very useful for boosting electric vehicles, renewable energy, electronics, aerospace, and defence applications. While presenting the Union Budget 2026-27 in the Lok Sabha, Finance Minister Nirmala Sitharaman said, ''It is proposed to provide basic customs duty exemption to the import of capital goods required for processing of critical minerals in India.'' She noted that a Scheme for Rare Earth Permanent Magnets was launched in November 2025. ''We now propose to support the mineral-rich States of Odisha, Kerala, Andhra Pradesh and Tamil Nadu to establish dedicated Rare Earth Corridors to promote mining, processing, research and manufacturing,'' she said. The finance minister proposed to reduce custom duty on Monazite under critical mineral section to zero from existing 2.5 per cent. Monazite is a reddish-brown phosphate mineral, typically found in igneous and metamorphic rocks or as heavy grains in placer deposits, serving as a primary ore for rare-earth elements (cerium, lanthanum, neodymium) and radioactive thorium. Earlier in November 2025, the Union Cabinet had approved 'Scheme to Promote Manufacturing of Sintered Rare Earth Permanent Magnets' with a financial outlay of Rs 7,280 crore. This first-of-its-kind initiative is aimed to establish 6,000 Metric Tons per Annum (MTPA) of integrated Rare Earth Permanent Magnet (REPM) manufacturing in India, thereby enhancing self-reliance and positioning India as a key player in the global REPM market. REPMs are one of the strongest types of permanent magnets and are vital for electric vehicles, renewable energy, electronics, aerospace, and defence applications. The Scheme will support the creation of integrated REPM manufacturing facilities, PM India involving conversion of rare earth oxides to metals, metals to alloys, and alloys to finished REPMs. Driven by the rapidly growing demand from electric vehicles, renewable energy, industrial applications, and consumer electronics, India's consumption of REPMs is expected to double by 2030 from 2025, the government had said. Presently, India's demand for REPMs is met primarily through imports. With this initiative, India will establish its first-ever integrated REPM manufacturing facilities, generating employment, strengthening self-reliance and advancing the nation's commitment to achieve Net Zero by 2070.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)