India Boosts Rare Earth Production Independence from China
India is ramping up its rare earth mineral production capabilities, reducing its reliance on China. The country’s main source of rare earth elements comes from Beach Sand Minerals (BSM), which are rich in monazite—a phosphate mineral containing Uranium and Thorium. IREL (India) Limited, a Public Sector Undertaking under the Department of Atomic Energy, is leading the charge by producing high-purity rare earth oxides from these minerals.
With operations at three sites dedicated to the integrated mining and processing of mineral sands, IREL has established significant facilities for extracting and refining rare earths. As part of a broader initiative to strengthen India’s rare earth value chain, several key developments have been undertaken.
Advancements in Rare Earth Production
Among these advancements is a newly operational Rare Earth Permanent Magnet plant in Vizag, which manufactures Samarium Cobalt magnets. Furthermore, IREL has set up mini plants within the Rare Earth & Titanium Theme Park in Bhopal, focusing on the production of essential metals such as Lanthanum, Cerium, and Neodymium. These initiatives are pivotal for enhancing the country’s rare earth production landscape.
Recycling and Financial Support for Manufacturing
In addition to new production facilities, IREL has implemented a recycling plant in Bhopal aimed at salvaging magnetic rare earth elements from end-of-life magnets. The Indian government is also taking significant steps to bolster local manufacturing through financial initiatives. On November 26, 2025, the Union Cabinet approved a scheme to support the manufacturing of Sintered Rare Earth Permanent Magnets (REPM) with an investment of Rs. 7,280 Crore. This ambitious plan aims to create a production capacity of 6,000 metric tonnes per annum in the country.
Under this scheme, five beneficiaries are anticipated to be selected through a competitive bidding process. A transparent Least Cost System (LCS) will ensure a fair evaluation of proposals, comprising both technical and financial bids. The initiative includes a Sales-Linked Incentive of Rs. 6,450 crore and a Capital Subsidy of Rs. 750 crore designed to promote domestic REPM manufacturing.
Strategic Goals for Economic Growth
This strategic move not only aims to decrease India’s dependency on imports for vital sectors, such as electric mobility, renewable energy, electronics, and defense, but also stands to generate employment and enhance domestic value chains. The announcement was made by Union Minister of State Dr. Jitendra Singh in a written reply to the Rajya Sabha, signaling a strong commitment by the Indian government to expand its rare earth capabilities.
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