To cut China reliance, support for rare earths, critical minerals, Pg11

Key Highlights:

• Union Budget FY27 proposes dedicated rare earth corridors in Odisha, Kerala, Andhra Pradesh, and Tamil Nadu to boost mining, processing, research, and manufacturing.
• Basic customs duty exemption announced on import of capital goods for critical mineral processing.
• Scheme to promote Sintered Rare Earth Permanent Magnet (REPM) manufacturing with a financial outlay of Rs. 7,280 crore.
• India imported over 53,000 mt of rare earth magnets during FY25, with consumption expected to double by 2030.

Detailed Insights:

• The initiative aims to reduce reliance on China, which dominates the global critical minerals and rare earth value chain.
• The REPM scheme supports 6,000 metric tonnes per annum of integrated manufacturing capacity, allocated among five beneficiaries via competitive bidding.
• Sales-linked incentives worth Rs 6,450 crore over five years and a capital subsidy of Rs 750 crore will be provided to set up integrated REPM units.
• Rare earth corridors will leverage beach sand deposits with rich monazite reserves in coastal states to produce essential rare earth elements.
• Incentivizing prospecting and exploration of critical minerals is emphasized, targeting 1200 exploration projects by FY31.

Key Concepts Involved:

• Rare Earth Elements: A set of seventeen metallic elements with similar properties, crucial for various technologies.
• Critical Minerals: Minerals essential for modern technologies and economies, with supply chains vulnerable to disruption.
• Monazite: A phosphate mineral containing rare earth elements, found in beach sand deposits.