India NdFeB Magnet Manufacturing Scheme RFP Targets 6,000 MTPA Capacity

The India NdFeB magnet manufacturing scheme has entered the execution phase with the Ministry of Heavy Industries issuing a Request for Proposal (RFP) to establish integrated rare earth permanent magnet production facilities. The initiative targets a combined capacity of 6,000 metric tonnes per annum and is open to both domestic and global participants. By enabling local production of sintered Neodymium-Iron-Boron magnets, the program aims to strengthen supply resilience and reduce reliance on imports in strategically critical sectors.

RFP Structure and Bidding Process

The tender follows a two-stage Least Cost System, where applicants must first qualify through a technical evaluation before proceeding to the financial bid stage. Submissions are to be completed via the Central Public Procurement Portal, ensuring transparency and standardized evaluation. The bidding timeline includes document availability from March 20, 2026, a pre-bid conference on April 7, and final submission by May 28, followed by technical bid opening on May 29.

Eligibility and Capacity Allocation

Selected participants will receive allocated production capacities ranging between 600 and 1,200 MTPA, structured in increments of 100 MTPA. This modular allocation approach allows flexibility for different investment scales while maintaining overall program targets. The scheme is designed to attract both large-scale industrial players and specialized material manufacturers capable of developing advanced magnet production capabilities.

Financial Incentives and Raw Material Support

The government has structured the scheme with a mix of capital subsidies and output-based incentives to attract investment. Companies can access capital support of ₹750 crore alongside sales-linked incentives totaling ₹6,450 crore. In addition, select participants will receive assured access to Neodymium-Praseodymium oxide sourced from IREL (India) Ltd., addressing one of the most critical supply constraints in the rare earth value chain.

Strategic Importance of NdFeB Magnets

NdFeB magnets play a central role in multiple high-growth industries due to their high magnetic strength and efficiency. They are essential components in electric vehicle traction motors, wind turbine generators, consumer electronics, and advanced medical equipment. As electrification and renewable energy adoption accelerate globally, demand for these magnets is increasing, making their supply chain a strategic priority for industrial economies.

• Electric vehicle motor systems
• Wind energy generation equipment
• Consumer electronics and storage devices
• Medical imaging technologies
• Defense and aerospace applications

Reducing Import Dependency and Building Value Chain

Currently, global production of rare earth materials and permanent magnets is heavily concentrated in a few regions, creating supply vulnerabilities. This scheme aims to establish a complete domestic ecosystem, covering raw material processing to finished magnet manufacturing. By integrating upstream supply from IREL with downstream industrial production, the program intends to retain more value within the domestic economy and enhance supply security for critical industries.

Role of Domestic Resources

India possesses significant reserves of rare earth minerals, particularly in coastal regions rich in beach sand deposits. While extraction and initial processing have been ongoing for decades, the absence of large-scale downstream manufacturing has limited value addition. The current initiative bridges this gap by linking resource availability with industrial capability development, ensuring that raw materials are transformed into high-value components domestically.

Alignment with Broader Industrial Policy

The scheme is part of a wider industrial strategy focused on strengthening manufacturing across emerging technologies. Similar frameworks have already been implemented in sectors such as semiconductors, solar energy, and battery technologies. By combining financial incentives with long-term policy direction, the government aims to attract investments that support electrification, renewable energy expansion, and advanced manufacturing growth.

This initiative represents a structured attempt to secure critical material supply chains while enabling domestic industry participation in high-value global markets, positioning the country as a competitive player in rare earth magnet production.