New tender aims to boost domestic production of critical components used in EVs, wind energy and electronics
The Ministry of Heavy Industries has invited global bids to establish rare earth permanent magnet manufacturing facilities in India, marking a key step in implementing its ₹7,280 crore scheme to boost domestic production in a strategically important sector.
The tender seeks proposals to set up integrated facilities with a total capacity of 6,000 metric tonnes per annum (MTPA) for manufacturing sintered neodymium-iron-boron (NdFeB) rare earth permanent magnets.
Key Highlights
- Global tender issued for setting up rare earth magnet manufacturing units
- Total planned capacity: 6,000 MTPA across multiple facilities
- Scheme outlay: ₹7,280 crore approved in November 2025
- Financial incentives include capital subsidy and sales-linked incentives
- Bidding process to be conducted online through the CPP Portal
Bidding Process and Timeline
According to the ministry, the bidding process will follow a two-stage system involving technical and financial evaluations. Selection will be based on a Least Cost System (LCS), designed to ensure transparency and competitive pricing.
- Tender documents available from March 20, 2026
- Pre-bid meeting scheduled for April 7, 2026
- Bid submission deadline: May 28, 2026
- Technical bids to be opened on May 29, 2026
Successful bidders will be eligible for financial support under the scheme.
What the Scheme Offers
The Scheme to Promote Manufacturing of Sintered Rare Earth Permanent Magnet provides a mix of upfront and performance-based incentives:
- Capital subsidy of ₹750 crore
- Sales-linked incentives worth ₹6,450 crore
- Assured supply of key raw material (NdPr oxide) for select bidders
Each selected manufacturer will be allocated production capacity ranging from 600 to 1,200 MTPA.
Why Rare Earth Magnets Matter
Rare earth permanent magnets, particularly NdFeB magnets, are critical components in several advanced technologies. They are widely used in:
- Electric vehicles (EVs)
- Wind turbines
- Consumer electronics
- Aerospace and defence systems
These magnets are valued for their high strength and efficiency, making them essential for energy transition technologies.
Context: Reducing Import Dependence
India currently relies heavily on imports for rare earth magnets and related materials. The new scheme aims to build a domestic manufacturing ecosystem by developing the entire value chain—from raw material processing to finished products.
The Cabinet approved the scheme in November 2025 as part of broader efforts to strengthen domestic manufacturing and reduce reliance on global supply chains, particularly in critical sectors.
Public Impact: What This Means
The initiative is expected to have wider economic and strategic implications:
- Strengthening India’s position in the global clean energy supply chain
- Supporting growth of electric mobility and renewable energy sectors
- Reducing import costs and supply risks
- Creating new manufacturing investments and jobs
By securing domestic production of key components, the government aims to support long-term industrial and energy goals.
Conclusion
The launch of the global tender marks the operational rollout of India’s rare earth magnet manufacturing scheme. As the bidding process progresses, the selected projects are expected to play a significant role in building a self-reliant ecosystem for critical technologies.
The outcome of the tender, expected after bid evaluations in May, will determine the next phase of investments in this emerging sector.
Source – PIB
Edited by Mantena Sasank
Last Updated on: Friday, March 20, 2026 4:09 pm by Mantena Sasank | Published by: Mantena Sasank on Friday, March 20, 2026 4:09 pm | News Categories: Bengaluru