Source: PIB
Context:
The Union Budget 2026–27 announced the establishment of dedicated Rare Earth Corridors in four coastal states to strengthen India’s critical minerals ecosystem, reduce import dependence, and support clean-energy and high-technology manufacturing.
What Are Rare Earth Corridors?
Rare Earth Corridors are integrated, state-anchored industrial value chains that geographically co-locate:
- Mining of rare earth–bearing minerals
- Separation and processing of rare earth elements (REEs)
- R&D and pilot facilities
- Manufacturing, especially Rare Earth Permanent Magnets (REPMs)
The corridor approach minimizes logistics costs, closes technology gaps, and accelerates time-to-market by creating clustered ecosystems rather than isolated projects.
States Involved (Coastal Focus)
The corridors will be established in four mineral-rich coastal states with significant Beach Sand Mineral (BSM) deposits containing monazite—India’s principal source of REEs:
- Odisha
- Kerala
- Andhra Pradesh
- Tamil Nadu
Why coastal states?
India’s most accessible and commercially viable REE resources are in beach placer sands, especially monazite, which is rich in Light REEs such as Neodymium (Nd) and Praseodymium (Pr)—critical for magnets.
Aim of the Initiative
- Build an end-to-end domestic rare earth value chain (mine → magnet)
- Support the clean-energy transition (EVs, wind turbines, solar power)
- Operationalise the National Critical Minerals Mission at the state level
- Strengthen supply-chain resilience amid global concentration of REE processing
Key Features of the Rare Earth Corridor Initiative
1. Integrated Corridor Approach
- Co-location of mining, processing, R&D, and manufacturing
- Reduces inter-state logistics frictions
- Encourages technology spillovers and faster scale-up
2. Linkage with Magnet Manufacturing Scheme
- Aligned with the ₹7,280 crore Sintered REPM Scheme
- Target: ~6,000 MTPA domestic REPM capacity
- Addresses a critical downstream bottleneck in EVs and renewables
3. State-Led Execution
- Moves beyond a purely central-policy approach
- States act as industrial anchors, enabling:
- Faster clearances
- Tailored infrastructure
- Skill development aligned to local geology
4. Incentive-Backed Manufacturing
- Sales-linked incentives: ~₹6,450 crore
- Capital subsidy: ~₹750 crore
- Incentivises integrated REPM units within corridors
5. Strategic Supply-Chain Resilience
- India imported >53,000 MT of magnets in FY25
- Corridors aim to reduce vulnerability to externally concentrated supply chains
6. Support for High-Tech Sectors
- Ensures domestic inputs for:
- EVs
- Renewable energy
- Electronics
- Aerospace & Defence
Major Coastal Potential: Beach Sand Monazite (State-wise)
Odisha
- Chhatrapur (OSCOM) region
- Highest current processing activity
- Acts as a mature anchor for corridor development
Kerala
- Chavara deposits; proximity to Vizhinjam Port
- Long history of BSM mining and processing
- Likely to be a hub state in the corridor network
Andhra Pradesh
- Coastal stretches of Srikakulam, Visakhapatnam, Nellore
- Large untapped placer resources with industrial port access
Tamil Nadu
- Manavalakurichi and southern coastal districts
- Established rare earth processing legacy
Emerging Inland Rare Earth Mineral Potential (New Geography Focus)
Recent exploration by the Geological Survey of India (GSI) indicates significant inland REE potential, particularly for Heavy REEs, which are scarcer and more valuable.
- Arunachal Pradesh
- Papum Pare district
- High Neodymium content in river-valley soils
- Rajasthan
- Balotra: >1 lakh tonnes of in-situ REE oxides
- Exploration in Sirohi and Bhilwara
- West Bengal
- Purulia district (South Purulia Shear Zone)
- Gujarat
- Amba Dongar and Kamthai carbonatite complexes
- Madhya Pradesh
- Singrauli coalfields: REEs associated with coal seams
- Jharkhand & Chhattisgarh
- Heavy REE-bearing stream placers in the Chotanagpur Granite Gneiss Complex
