The Ministry of Heavy Industries on Thursday released a Request for Proposal (RFP) inviting bids from companies seeking to set up integrated Sintered NdFeB Rare Earth Permanent Magnet (REPM) manufacturing facilities in India. The tender, open to both domestic and international applicants, targets a combined manufacturing capacity of 6,000 Metric Tonnes Per Annum (MTPA) and marks a step toward reducing India's dependence on imported magnets.
Bids are to be submitted through the Central Public Procurement (CPP) Portal using a two-stage Least Cost System (LCS), comprising a Technical Bid followed by a Financial Bid. Tender documents are available from March 20, 2026. A pre-bid conference is scheduled for April 7, 2026, giving prospective applicants an opportunity to seek clarifications before the final bid submission deadline of May 28, 2026. Technical bids will be opened the following day, on May 29, 2026.
Companies selected under the scheme will be eligible for a capital subsidy of ₹750 crore and sales-linked incentives totalling ₹6,450 crore. Each beneficiary will be allocated a production capacity between 600 MTPA and 1,200 MTPA, in multiples of 100 MTPA. In addition, the three lowest bidders will receive a limited assured supply of Neodymium-Praseodymium (NdPr) oxide from state-owned IREL (India) Ltd., providing them with a degree of raw material security that is otherwise difficult to access in the current global market.
The scheme was approved by the Union Cabinet on November 26, 2025, with a total financial outlay of ₹7,280 crore. It is described by the government as a first-of-its-kind initiative in India, designed to build a complete domestic value chain — from NdPr oxide processing through to finished sintered magnets — rather than supporting only one segment of production in isolation.
Rare Earth Permanent Magnets, particularly those made from Neodymium-Iron-Boron (NdFeB), are a critical industrial input across a range of sectors. They are used extensively in the motors of electric vehicles, in the generators of wind turbines, in hard disk drives, medical imaging equipment, consumer electronics, and in defence and aerospace systems. As global demand for clean energy technology and electrification grows, the strategic importance of these magnets — and the raw materials required to produce them — has risen considerably.
At present, China accounts for a dominant share of global rare earth mining, processing, and permanent magnet production, giving it significant influence over international supply chains. Several countries, including the United States, members of the European Union, Japan, and Australia, have in recent years identified rare earth supply chains as a matter of national and economic security, and have launched programmes to diversify sourcing and production.
India holds rare earth mineral reserves of its own, and IREL (India) Ltd., formerly Indian Rare Earths Limited, has been involved in the mining and processing of beach sand minerals containing rare earth elements for decades. However, the country has not yet developed a large-scale downstream industry to convert these materials into high-value products such as permanent magnets, leaving Indian manufacturers in sectors like electric vehicles and wind energy dependent on imports.
The current scheme seeks to address that gap. By connecting raw material supply from IREL with new magnet manufacturing facilities, the government aims to build a value chain that keeps more economic activity within India and reduces exposure to supply disruptions in global markets.
The broader policy context includes India's targets for electric vehicle adoption and renewable energy capacity, both of which require permanent magnets in quantity. The government has previously introduced production-linked incentive schemes in sectors such as semiconductors, solar panels, and advanced chemistry batteries as part of its manufacturing push under the broader "Make in India" framework. The rare earth magnet scheme follows a similar structure, combining capital support with output-linked incentives to attract investment.