India possesses around 8.52 million tonnes of rare earth oxide resources but relies on imports for rare earth magnets and related products due to challenges with domestic deposits, regulations, and processing. The Atomic Minerals Directorate for Exploration and Research has identified 7.23 million tonnes of rare earth oxide in monazite deposits across various states and an additional 1.29 million tonnes in hard rock terrains in Gujarat and Rajasthan.
Despite these reserves, India faces structural constraints leading to its reliance on imported rare earth magnets. These constraints include low domestic ore grades tied to radioactivity, limited mineable reserves due to regulations, and the absence of a complete rare earth value chain for manufacturing metals and magnets. In response, the Union Cabinet approved a scheme in November 2025 to boost the manufacturing of sintered rare earth permanent magnets with a significant financial outlay.
The approved scheme aims to establish a manufacturing capacity of 6,000 metric tonnes per annum for rare earth permanent magnets in India. It includes sales-linked incentives and capital subsidies totaling Rs 7,280 crore over five years. Additionally, a rare earth permanent magnet plant has been set up in Andhra Pradesh for the production of samarium cobalt magnets used in defense and atomic energy applications. The government has also announced the establishment of rare earth corridors in specific states to further support this industry.
