New Delhi [India], November 26 (ANI): In a significant initiative aimed at enhancing self-reliance and positioning India as a key player in the global REPM market, the Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved the 'Scheme to Promote Manufacturing of Sintered Rare Earth Permanent Magnets' with a financial outlay of Rs 7,280 crore.

This first-of-its-kind initiative aims to establish 6,000 Metric Tons per Annum (MTPA) of integrated Rare Earth Permanent Magnet (REPM) manufacturing in India.

Briefing reporters on the decisions of the Union Cabinet, Information and Broadcasting Minister Ashwini Vaishnaw said it is 'very important, strategic decision'.

The total financial outlay of the scheme is Rs 7280 crore, comprising sales-linked incentives of Rs 6450 crore on REPM sales for five years and capital subsidy of Rs.750 crore for setting up an aggregate of 6,000 MTPA of REPM manufacturing facilities.

The total duration of the scheme will be seven years from the date of award, including a two-year gestation period for setting up an integrated REPM manufacturing facility, and five years for incentive disbursement on the sale of REPM, an official release said.

The scheme envisions allocating the total capacity to five beneficiaries through a global competitive bidding process. Each beneficiary will be allotted up to 1,200 MTPA of capacity.

REPMs are one of the strongest types of permanent magnets and are vital for electric vehicles, renewable energy, electronics, aerospace, and defence applications.

The Scheme will support the creation of integrated REPM manufacturing facilities, involving conversion of rare earth oxides to metals, metals to alloys, and alloys to finished REPMs.

'The initiative by the Government of India is a landmark step towards strengthening the domestic REPM manufacturing ecosystem and enhancing competitiveness in the global markets. By fostering indigenous capabilities in REPM production, the scheme will not only secure the REPM supply chain for domestic industries but also support the nation's Net Zero 2070 commitment,' the release said.

'It embodies the governments unwavering commitment to build a technologically self-reliant, globally competitive, and sustainable industrial base, in line with the vision of Viksit Bharat @2047,' it added.

India currently relies heavily on imports of rare-earth permanent magnets, primarily from China. The proposed incentive mechanism is expected to support investment in processing, refining, and magnet-making capabilities, which remain underdeveloped in the country. (ANI)