India’s Bold Move: ₹5,000 Crore Scheme to Boost Rare Earth Mineral Production and Wean Off Chinese Control

In a strategic move to address the vulnerability arising from China’s near-monopoly on rare earth mineral processing, India is gearing up to launch a significant economic initiative. The proposed scheme, with an estimated budget of ₹3,500 to ₹5,000 crore, is designed to incentivize the production of rare earth minerals and magnets within India. The scheme aims to aid new budding industries to diversify mineral processing in India. The primary goal is to reduce the country’s dependence on Chinese imports, especially given China’s control over more than 90% of the global processing capacity. The incentives will be offered through a reverse auction process. This strategic investment comes amid growing concerns over supply chain security, particularly for the EV sector and turbine manufacturing units, which are major consumers of these essential materials. Furthermore, the government is planning to amend the mines and minerals act to support the critical mineral mission, alongside plans to initiate domestic production of rare earth permanent magnets this year.