India's Rs 7,280 Crore Rare Earth Magnet Scheme Drew 20 Bids for Five Places, Opened on 13 August 2026, in a Plan to Make 6,000 Tonnes of Magnets a Year

On 13 August 2026 the Ministry of Heavy Industries opened the technical bids for a Rs 7,280 crore (Rs 72.8 billion) scheme to make rare earth magnets in India, and counted 20 of them for five places. The scheme aims to build 6,000 tonnes a year of integrated capacity, which the Union Cabinet described on 26 November 2025 as India’s first ever integrated facilities for these magnets. As of 14 October 2026, no beneficiary has been named in any release the ministry has published.

What the scheme pays for

The Cabinet, chaired by the Prime Minister, approved the Scheme to Promote Manufacturing of Sintered Rare Earth Permanent Magnets on 26 November 2025, and the Ministry of Heavy Industries notified it on 15 December 2025. “Sintered” names the type of magnet the scheme covers, a neodymium-iron-boron magnet in its sintered form. “Integrated” is the key word in the scheme’s design: each winning plant has to cover the whole chain, turning rare earth oxides into metals, metals into alloys and alloys into finished magnets.

The money is split two ways. Rs 6,450 crore is a sales-linked incentive, paid on magnets a beneficiary actually sells over five years. Rs 750 crore is a capital subsidy for setting up the plant. The two listed parts add up to Rs 7,200 crore, and the releases do not say what the remaining Rs 80 crore of the stated outlay covers.

The scheme runs seven years from the date of award: two years to build, then five years of incentives. The Cabinet release says capacity goes to five beneficiaries, each allotted up to 1,200 tonnes a year, which makes 6,000 tonnes with all five at the maximum. The tender documents set the range at 600 to 1,200 tonnes per beneficiary, in multiples of 100.

Why a magnet gets a scheme of its own

The magnets in question are neodymium-iron-boron (NdFeB) magnets. The International Energy Agency’s 2026 report on rare earths says they are made mainly from neodymium and praseodymium, often with dysprosium and terbium added, and that they are among the strongest permanent magnets made. Its summary lists electric vehicles, wind turbines, industrial motors, data centres and medical, aerospace and defence equipment among the uses. The government’s own releases name electric vehicles, wind turbines, electronics, aerospace and defence. Readers who want the vehicle side of the market can find it in India’s electric vehicle numbers, and the defence side in the story of India’s defence industry.

The Cabinet release says India’s consumption of these magnets is expected to double between 2025 and 2030, and that demand is met mainly through imports. A PIB backgrounder of 2 February 2026 puts China’s share of India’s magnet imports at 85 to 90 per cent by quantity between 2022 and 2025. CareEdge, a rating agency, reached nearly 90 per cent for the financial years 2024 and 2025 in a report dated 12 June 2025.

The supply scare that gave the scheme its backdrop

The IEA reports that China produced 94 per cent of the world’s sintered permanent magnets in 2024 and 91 per cent of refined magnet rare earths. In April 2025 China began requiring licences for exports of seven heavy rare earth elements and magnets containing them. The IEA says exports fell sharply in April and May, and some carmakers elsewhere cut output or shut lines for a time.

CareEdge’s June 2025 report said none of the Indian firms’ licence applications had been approved as of that month and warned of possible production cuts from July. On 30 October 2025 the External Affairs Ministry’s spokesperson said at a weekly briefing: “Some Indian companies have received licences for importing rare earth magnets from China.” China announced wider controls in October 2025 and, according to the IEA, suspended them in November 2025 for a year. The Cabinet approved the Indian scheme on 26 November 2025, in the same month as that suspension.

Where India stands on the raw material

India does have the ore. The Department of Atomic Energy’s Atomic Minerals Directorate for Exploration and Research estimated, in a Lok Sabha reply of 23 July 2025, about 7.23 million tonnes of rare earth oxide contained in 13.15 million tonnes of monazite, a mineral found in coastal beach sands and inland river deposits in states from Odisha and Kerala to Gujarat. It estimated another 1.29 million tonnes of oxide in hard rock in Gujarat and Rajasthan. The Geological Survey of India has added 482.6 million tonnes of rare earth ore resources across 34 exploration projects. The Union Budget for 2026-27 announced rare earth corridors in Odisha, Kerala, Andhra Pradesh and Tamil Nadu.

These are estimates of oxide in the ground, not tonnes that can be mined. In an April 2026 Rajya Sabha reply, as reported by IANS, Dr Jitendra Singh listed low ore grades, restrictions on where mining is allowed and the lack of an industry that turns refined oxide into metals, alloys and magnets as the reasons magnets are still imported. The third gap is the one this scheme targets. A different incentive programme aimed at a gap in Indian manufacturing, for chips, is covered in the India Semiconductor Mission plants.

The oxide for the first plants will come partly from a state company. The tender says the three lowest bidders get a limited, assured supply of neodymium-praseodymium (NdPr) oxide from IREL (India) Limited, the Department of Atomic Energy company that runs a rare earth extraction plant in Odisha and a refining unit at Aluva in Kerala. The releases give no tonnage for that supply.

The bidding round, step by step

The ministry published the Request for Proposal on 20 March 2026, held a pre-bid conference on 7 April, and set 28 May 2026 as the bid deadline. The deadline was extended, and the last date for bids became 12 August 2026. Technical bids were opened the next day, 13 August, with bidders present at the ministry.

The bidding is run online through the Central Public Procurement Portal in two stages, a technical bid and a financial bid, under what the ministry calls a Least Cost System. The ministry’s 13 August release called the response “overwhelming”. The 20 bidders it listed are:

• 20 Microns Limited
• Attero Recycling Private Limited
• BaRupOn and IRP Consortium
• Coal India Limited
• Jay Fe Cylinders Limited
• Keystone Infra and Huebox Interiors (joint venture)
• Larsen & Toubro Limited
• Lohum Magnets & Energy Solutions Private Limited
• Midwest Energy Limited and Midwest Advanced Materials (joint venture)
• N.A.N. Magnetech Private Limited
• NEO Performance Materials (Singapore) Pte. Ltd.
• Nexon Geochem Private Limited
• PrNd Metal and Magnets Pvt. Ltd.
• Proterial (India) Limited
• Prozeal Green Energy Limited
• Ramp Metals & Minerals Private Limited
• ReNew Private Limited
• Shankaranarayana Constructions Limited
• Solpro Greentech Private Limited
• Starteck Finance Limited

Three of the 20 are joint ventures or consortiums, and one is a Singapore-registered company. None of these firms has been announced as a beneficiary.

What is still undecided

The sources reviewed for this article contain no announcement of a technical evaluation result, a financial bid opening or an award as of 14 October 2026. The ministry’s releases do not say when those steps will happen. The seven-year scheme period starts from the date of award, so the two-year build time and five years of incentives have not begun.