India’s ₹7,280 Crore Magnet Scheme Drew 20 Bids. First Output Is Still 2028.

Written 27 August 2026. Beneficiary selection had not been announced at the time of writing.

The Ministry of Heavy Industries received 20 bids under India’s Scheme to Promote Manufacturing of Sintered Rare Earth Permanent Magnets. Bidding closed on 12 August 2026 and technical bids were opened the following day, 13 August, at the ministry in the presence of bidders.

Reported bidders include Larsen & Toubro, Coal India, ReNew, Attero Recycling, Lohum, 20 Microns, Prozeal Green Energy, and the overseas magnet specialists NEO Performance Materials (Singapore) and Proterial (India).

Approved by the Union Cabinet in November 2025 with an outlay of ₹7,280 crore, it targets 6,000 metric tonnes per annum of integrated magnet manufacturing capacity, allocated across five beneficiaries selected by global competitive bidding, each eligible for up to 1,200 MTPA.

• •₹6,450 crore in sales-linked incentives over five years.
• •₹750 crore in capital subsidy.
• •A two-year gestation period before incentive disbursement begins.
• •A limited assured raw material supply from IREL (India) Ltd for selected beneficiaries.

The RFP was issued on the CPP Portal on 20 March 2026 with a pre-bid conference on 7 April. The submission deadline moved from July to 12 August, with technical opening on 13 August.

That is a modest slip by the standards of Indian industrial schemes, and the bidder list suggests the delay bought participation rather than costing it — the presence of two established overseas magnet makers alongside domestic industrial and recycling firms is a more serious field than the scheme looked likely to attract when it was announced.

India sourced between roughly 60 and 81 per cent of its permanent magnet requirement from China across 2022–23 to 2024–25, and domestic consumption is projected to double by 2030 on the back of electric mobility and renewables. For anyone building traction motors, pumps or generators in India, a domestic magnet source changes the risk profile.

But not for several years, and not completely.

• •Two years of gestation before production means the first output arrives around 2028 at the earliest.
• •It arrives into a market where the harder constraint is heavy rare earth separation rather than magnet sintering. Dysprosium and terbium are what let a magnet survive a hot rotor, and they are the elements under the tightest export control.
• •The assured IREL supply is limited, and IREL’s current scale is small relative to 6,000 MTPA of magnet capacity.

The Union Budget 2026–27 added Dedicated Rare Earth Corridors in Odisha, Kerala, Andhra Pradesh and Tamil Nadu, covering mining, processing, research and manufacturing — which is the right shape of response, since the binding constraint sits upstream of the magnet plant rather than at it.

Our chapter on the separation cascade covers why that upstream step is the hard one, and why rare earths are not rare covers what the alternatives to importing them actually are.