Missing measure in India’s magnet mission

Most Indians know the parable of several blind men trying to describe an elephant. One touches its trunk and believes it is a snake. Another feels its leg and insists it is a pillar. None is entirely wrong, yet none sees the whole animal.

India’s strategy for advancing its cutting-edge technologies, aimed at becoming a global manufacturing leader, carries the risk of making a similar mistake. From EV motors and semiconductor fabrication facilities to precision manufacturing machineries, at the heart of each lies an unassuming component: the high-performance permanent magnet. They serve as the silent operating system of industrial acceleration.

Magnets are not all the same. Ferrite, Alnico and Samarium-Cobalt magnets continue to serve important industrial applications. Yet Neodymium-Iron-Boron (NdFeB) magnets have become the backbone of energy transition and advanced manufacturing because no other commercially available permanent magnet combines comparable magnetic strength with such a high power-to-weight ratio. Recognising its importance, India has begun strengthening its critical minerals and rare earth element strategy through initiatives such as the National Critical Mineral Mission, overseas mineral acquisitions, expanded geological exploration, and PLI schemes.

However, China’s tight export controls on rare-earth magnets and materials in April 2025 not only revealed the deep-seated vulnerabilities in global industrial value chains, but also the limits of our understanding. For India, the primary vulnerability does not stem from a shortage of critical minerals; rather, it lies in the absence of a comprehensive framework to pinpoint where strategic technological dependence is cultivated, accumulated and propagated throughout the permanent magnet value chain.

The journey of a magnet

Consider a simple example. India’s Annual Survey of Industries estimates the domestic permanent magnet market at around ₹750 crore. Yet international trade statistics indicate import values several times larger than that entire reported market. The gap may reflect differences in statistical coverage, industrial classification or supply-chain accounting. Whatever the explanation, policymakers face a troubling reality: they cannot confidently explain where all these magnets enter the economy or how they move through it. In other words, parts of India’s permanent magnet economy appear to exist without being fully visible in statistics.

Also read: Reliance, Vedanta, Adani join India’s drive to cut China rare earth dependence

Unlike other products, permanent magnets pass through a long technological journey. Geological exploration leads to mining. Mining feeds mineral processing. Processing enables chemical separation. Separation produces oxides, which are refined into metals, transformed into alloys, engineered into magnetic materials, and finally manufactured into finished magnets. Each stage demands different scientific knowledge, industrial capability and technological maturity. This is why discussions on critical minerals frequently miss the real point. The strategic question is not simply whether India possesses rare-earth resources or whether imports from China can be reduced. The real policy challenge is understanding what happens in between.

Although India has developed capabilities across several stages of permanent magnet manufacturing, the country still lacks a systematic way of identifying where those capabilities are globally competitive, where critical gaps persist, and how dependence accumulates across production stages. India’s statistical system provides only a partial picture of what is mined, imported, and manufactured.

One way to bridge this gap is through an Integrated Techno-Economic Mapping (ITEM) framework, which presently is a missing piece in India’s industrial policy toolkit. Such a framework brings together information on engineering and economic measurement to show how a permanent magnet is built, from minerals in the ground to the finished products that power advanced manufacturing. More importantly, it would identify where industrial capability should be built, where technological partnerships become essential, and where domestic investment would yield the greatest strategic return. A country may secure mineral resources yet remain dependent if it lacks processing and manufacturing capabilities.

Bridging this measurement gap is not an academic exercise; it is an industrial imperative.

Suvajit Banerjee is a Fellow at the National Council of Applied Economic Research (NCAER), New Delhi, in the research vertical of Computable General Equilibrium Modelling and Policy Analysis. Sovini Mondal is a Research Analyst at the NCAER in the research vertical of Computable General Equilibrium Modelling and Policy Analysis. Sanjib Pohit is a professor and Thematic Lead at the NCAER in the research vertical of Computable General Equilibrium Modelling and policy analysis. Views are personal.