REPM Scheme - India to Build 6,000 MTPA Sintered Rare Earth Permanent Magnet (REPM) Capacity

(Image: DhruvStar Industry Insights | Original Artwork)

Approval of the REPM Scheme

The Union Cabinet has approved the Scheme to Promote Manufacturing of Sintered Rare Earth Permanent Magnets (REPM) with a total outlay of INR 7,280 crore. 

This is India’s first major initiative to establish an integrated domestic ecosystem for REPM manufacturing, a critical component for electric mobility, renewable energy, electronics, aerospace and defence.

The REPM scheme aims to create 6,000 MTPA (Metric Tons per Annum) of integrated REPM manufacturing capacity, covering the entire manufacturing chain - from rare earth oxides to metals, metals to alloys, and alloys to finished magnets.

Read More: Critical Mineral Recycling

Importance of Sintered Rare Earth Permanent Magnets (REPM)

Sintered Rare Earth Permanent Magnets are among the strongest permanent magnets and form the backbone of high-performance technologies. India’s demand for REPMs - driven by electric vehicles, renewable energy projects, industrial machinery and consumer electronics - is expected to double between 2025 and 2030.

Currently, most of India’s REPM requirements are imported. The new REPM scheme aims to build domestic capability, enhance strategic security, promote self-reliance, create jobs and contribute to the country’s Net Zero 2070 goals.

Read More: Indian Rare Earths - From Reserves to Global Value Chains

Incentives and Capacity Allocation for the REPM Manufacturing Scheme

The INR 7,280 crore outlay includes:

• INR 6,450 crore in sales-linked incentives over 5 years,
• INR 750 crore as capital subsidy for setting up integrated REPM facilities,
• Total target capacity: 6,000 MTPA, and
• Five beneficiaries will be selected through global competitive bidding, with each eligible for up to 1,200 MTPA of allocated capacity.

Implementation Timeline of the REPM Scheme

The scheme will run for 7 years, which includes:

• 2-year gestation period to build integrated REPM facilities, and
• 5 years of incentive disbursement based on REPM sales.

This structure is designed to accelerate project execution while ensuring long-term viability.

Expected Impact on India’s Industrial Ecosystem

The REPM scheme establishes India’s first end-to-end REPM manufacturing ecosystem, improving supply-chain security for domestic industries, reducing import dependence, and boosting global competitiveness. 

It also supports the broader goals of technological self-reliance, sustainable industrial growth and the vision of Viksit Bharat @2047.

DhruvStar Industry Insights: What It Means for the Indian Industry

• Opportunity to Build Critical Minerals Processing Capabilities: The Sintered Rare Earth Permanent Magnets (REPM) manufacturing scheme opens significant scope for Indian firms to strengthen upstream capabilities in rare earth processing, alloying, and magnet manufacturing - areas traditionally dominated by global suppliers.
• Boost for Domestic EV and Renewable Energy Supply Chains: With REPMs integral to motors, generators and advanced electronics, domestic production can reduce import dependence and improve cost competitiveness for EV and clean-energy manufacturers.
• Scope for Technology Partnerships and Joint Ventures: The global bidding process encourages collaborations with international magnet producers, enabling technology transfer and faster scaling of domestic capabilities.
• Strategic Advantage in Defence and Aerospace Manufacturing: A stable REPM supply supports emerging sectors such as UAVs, precision systems and high-efficiency propulsion technologies, strengthening India’s advanced manufacturing base.

Sources

[1] PIB

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