Athira Sethu
Kochi, 7 April 2026
Vedanta and Hindustan Zinc Ltd (HZL) are in the limelight as they are one of the contenders in the pre-bid meeting for the Rs 7,280 crore project on rare earth magnets, as per a PTI report.
This project involves the production of rare earth magnets in large quantities. These are used in the making of several high-technology goods, ranging from electric vehicles and wind turbines to medical instruments. The government has invited companies to bid for setting up units to manufacture 6,000 metric tonnes of rare earth magnets annually. The first step will be undertaken on April 7, while the final bidding date will be May 28, 2026.
What are rare-earth magnets?
Rare earth magnets are highly magnetic substances made up of materials such as neodymium or samarium cobalt. Unlike conventional magnets, they have several properties that make them superior, including small size, lesser weight, and strength.
Details about the scheme:
In December 2025, the government came up with a scheme that includes the creation of such magnets domestically through a budget of ₹7,280 crores. This scheme would be geared towards cutting back India’s dependency on China for these critical components in the manufacture of electric vehicles.
The scheme is expected to facilitate India’s manufacturing of factories where rare-earth raw materials would be used to produce strong magnets. Any company that utilizes the domestically manufactured magnets would be encouraged by offering various rewards.
In this scheme, five companies would be selected, and each would be allocated a specific quota of the total production target of 6,000 metric tons per year. The chosen five firms would then get rewarded and assisted to develop factories according to the extent to which they sell their products and the extent to which the factory would benefit from subsidies. It takes seven years to implement the scheme, two years of which would be spent setting up the factories while the remaining five would be reward-oriented based on the company’s sales.
Overall, the government intends to increase its domestic manufacturing of rare earth magnets.
