Amid China's export curbs, India plans Rs 1,345 crore rare earth magnet incentive scheme

India is considering a ₹1,345-crore scheme to incentivise domestic production of rare earth magnets, critical components for electric vehicles and electronics, in a bid to reduce dependence on China amid export restrictions by Beijing.

The Centre has already allocated the funds for the proposed scheme and interministerial consultations are underway, Union heavy industries minister H D Kumaraswamy told journalists here on Friday.

Permanent magnets derived out of rare earth elements (REEs) are vital for power windows, speakers, propulsion systems in electric vehicles (EVs), and generators in renewable energy infrastructure, among others. Currently, India depends heavily on Chinese imports for these magnets and Chinese export controls are threatening to stall the production of cars in the country.


E-truck scheme portal
Speaking during the launch of a portal to facilitate subsidies for electric trucks under the ongoing PM E-Drive scheme, Kumaraswamy also said, "Diesel trucks, though constituting only 3% of the total vehicle population, contribute to 42% of transport-related greenhouse gas emissions and significantly worsen air pollution." The government is offering up to ₹9.6 lakh per truck for switching to electric trucks to push decarbonisation. The ₹500-crore scheme is expected to support deployment of approximately 5,600 e-trucks across the country.

An official statement said a dedicated provision for 1,100 e-trucks registered in Delhi has been made with an estimated outlay of ₹100 crore.

Beneficiaries will need to submit scrapping certificates of old trucks to be eligible to claim subsidies under the scheme. Officials said these certificates can be purchased through authorised retailers from scrapping centres.