By bizn_fun 
In November 2025, India approved a 73bn-rupee ($800m; £600m) plan that could help it to cut its dependence on China in one of the most strategic corners of the global supply chain: rare earth magnets.
These small but powerful components sit at the heart of modern life – used in everything from electric vehicles and wind turbines to smartphones, medical scanners, and defence equipment.
Developing a full rare earths ecosystem is expensive, complex and time-consuming. By focusing on magnets instead, one of the most widely used rare-earth products, India aims to achieve self-reliance more quickly.
But its success will depend on how fast the country can master technology, secure materials and scale up, experts say.
Under the scheme, external, selected manufacturers will receive capital and sales-linked incentives to produce 6,000 tonnes of permanent magnets a year within seven years. The aim is to meet rising domestic demand, which officials expect to double in five years.
Industry experts warn that money alone will not be enough.
India today imports 80- 90% of its magnets, external and related materials from China, which controls more than 90% of global rare earth processing. Official figures show the country imported some $221m worth of magnets and related raw material in 2025.
That dependence was exposed last year, external when China tightened exports during a trade dispute, hitting Indian carmakers and electronics firms, and forcing the electric vehicle (EV) industry to explore alternatives, external to rare earth magnets altogether.
The disruption was temporary, but the lesson lingered – without a sovereign rare earths strategy, entire industries remain vulnerable.
India is not alone in scrambling for alternatives. The EU, Australia and others have launched similar efforts to loosen China’s grip. For many countries, “the timing of the controls came as a surprise”, says Rajnish Gupta, a tax and economic policy specialist at EY India.
India’s challenge, however, is more complex.