Centre invites bids to set up rare earth magnet unit under ₹7,280 cr scheme

The request for proposal seeks applicants to establish integrated Sintered NdFeB Rare Earth Permanent Magnet (REPM) units with a total capacity of 6,000 metric tonnes per annum (MTPA)

The Ministry of Heavy Industries on Friday issued a request for proposal (RFP) to invite bids for setting up domestic manufacturing facilities for rare earth permanent magnets, advancing India’s push to build a self-reliant supply chain in critical minerals.

 

The RFP seeks applicants to establish integrated Sintered NdFeB (neodymium-iron-boron) Rare Earth Permanent Magnet (REPM) units with a total capacity of 6,000 metric tonnes per annum (MTPA). The bidding process will be conducted online through a two-stage system comprising technical and financial bids on the central public procurement portal, the ministry said.

 

Tender documents are available from March 20, 2026. A pre-bid meeting is scheduled for April 7, while bids will close on May 28. Technical bids will be opened on May 29.

   

The move follows the Union Cabinet’s approval in November 2025 of a ₹7,280 crore scheme to promote domestic manufacturing of sintered rare earth magnets. Under the scheme, companies will be eligible for capital subsidy and sales-linked incentives, with each unit allocated a capacity between 600 MTPA and 1,200 MTPA. "The scheme provides a capital subsidy of ₹750 crore and sales-linked incentive of ₹6,450 crore, with limited assured supply of NdPr oxide from IREL (India) Ltd for the three lowest bidders," the ministry said. 

 

What are rare-earth permanent magnets?

Rare-earth permanent magnets are among the most powerful magnets available. They are typically made using rare earth elements such as neodymium, along with iron and boron. Known for their high magnetic strength and efficiency, they are critical components used in the manufacturing of advanced technologies.

 

These magnets are widely used in electric vehicles, wind turbines, high-end electronics, as well as aerospace and defence systems. 

 

Why does it matter?

India holds around 6.27 per cent of global rare earth reserves but accounts for only 0.83 per cent of production, according to an EY report. As a result, the country remains heavily dependent on imports. The global market is dominated by China, which accounts for 68.6 per cent of worldwide rare earth production.

 

The Centre's push for domestic manufacturing came after China, last year, restricted exports of several rare earth elements and related magnets, which disrupted manufacturing supply chains globally.