Pushing for self-reliance, the Indian government plans to support automakers in developing rare-earth-free components and materials.
In a bid to reduce India’s dependence on imports of critical minerals from China, the government is encouraging the automobile industry to invest in rare-earth-free technologies, as reported by Mint. This move comes amid renewed concerns over global supply disruptions and rising geopolitical tensions that threaten the availability of key materials used in electric vehicles (EVs) and hybrid systems.
Officials familiar with the matter said that the Ministry of Heavy Industries (MHI), in consultation with the Ministry of Mines, is exploring a framework that incentivises companies to develop alternative magnetic materials and motor designs. These innovations aim to eliminate or minimise the use of rare earths such as neodymium and dysprosium, commonly found in EV motors and batteries.
The initiative, expected to be included in the next phase of the Production-Linked Incentive (PLI) scheme, seeks to promote domestic R&D, local sourcing, and sustainable manufacturing. Industry players including Tata Motors, Mahindra & Mahindra, and Maruti Suzuki have reportedly been briefed on the plan.
Government officials believe that investing in rare-earth-free technologies will enhance supply chain resilience and align with India’s goal of becoming a global EV manufacturing hub. “This is a long-term strategy to de-risk India’s auto industry from future raw material shocks,” a senior MHI official said.
India currently imports more than 90% of its rare earth supplies from China, a dependence that has become increasingly risky amid trade restrictions and fluctuating prices.
Experts say that adopting magnet-free motors and alternative battery chemistries could also reduce production costs over time, helping automakers remain competitive while advancing India’s green mobility mission.
