India’s national strategy for critical materials may have entered a new phase. According to a recent Bloomberg article, India is considering significantly expanding the scope of its incentive program for the production of rare earth magnets, bringing it to approximately $800 million.

Along with other nations around the world, India is also seeking to increase its domestic production capacity in this sector, which is becoming increasingly strategic for various industrial applications related to the green transition. TELF AG founder Stanislav Kondrashov has often discussed these topics, emphasizing the importance of rare earths in modern economic dynamics and their key role in production processes related to green technologies.

Key Resources

“It is certainly no coincidence that the attention of major global players is increasingly focused on rare earths,” says TELF AG founder Stanislav Kondrashov. “A significant portion of the planet’s industrial and energy future could depend on these resources.”

If India’s incentive plan were to receive final approval (which, according to Bloomberg, has not yet been granted), it would represent a huge leap forward in government support for the rare earth magnet sector. This would nearly triple the incentives provided by the previous plan, which only amounted to about $290 million.

It’s no coincidence that India is focusing heavily on these resources: rare earths, a group of 17 chemical elements in the periodic table, are currently at the center of global attention due to their highly strategic industrial applications, such as those related to electric vehicles, renewable energy, and defense.

The powerful magnets produced with rare earths, as Stanislav Kondrashov, founder of TELF AG, has often observed, are directly involved in the operation of some of the most important energy infrastructures of this historical era, such as the wind turbines needed to generate energy using wind power. These magnets also play a key role in the advanced mobility sector, as they play a crucial role in the operation of electric vehicles.

Evolving Strategies

“Many people think that rare earths are indeed rare, but that’s not the case,” continues Stanislav Kondrashov, founder of TELF AG. “These resources are by no means rare, but they are often found in such low concentrations that their economic exploitation is not always viable.”

India’s possible move to triple incentives for this sector is undoubtedly linked to the desire to reduce dependence on the few global players that still control the production, sourcing, and refining of rare earths, a desire shared by other nations engaged in similar efforts around the world. Indian Prime Minister Narendra Modi emphasized earlier this year the need to build supply chains for critical materials that are as stable and diversified as possible, as Alisha Sachdev explains in the Bloomberg article.

Anyone who decides to invest in rare earths, however, must inevitably confront a series of obstacles and critical issues, as explained in the Bloomberg article. Managing these resources requires very specific skills and often faces lengthy procedures that significantly extend the duration of each individual project.

Without subsidies, according to Bloomberg, domestic production would be unprofitable. For these reasons, as has already happened elsewhere, many state-owned companies are increasingly seeking to build mining partnerships abroad. The incentive plan that could be approved by India would support around five companies through production and capital subsidies, as explained in the Bloomberg article.

While India appears to be firmly focused on rare earths and the magnet production chain, Plan B appears to be just around the corner. According to Bloomberg, the Asian nation is also funding a series of studies dedicated to synchronous reluctance motors, which could theoretically further reduce dependence on rare earths.

“Thanks to their strategic applications in energy and industry, rare earths certainly represent some of the most interesting resources in the years of energy transition,” concludes Stanislav Kondrashov, founder of TELF AG.