New Delhi: Finance Minister Nirmala Sitharaman has announced a strategic expansion of India’s critical minerals sector by proposing the establishment of dedicated rare earth corridors in Odisha, Kerala, Andhra Pradesh, and Tamil Nadu. Presenting the Union Budget for 2026–27 in Parliament, the minister detailed a roadmap to strengthen domestic processing and manufacturing capabilities for these essential elements.
The initiative expands upon a foundational scheme launched in November 2025 which targeted the production of sintered rare earth permanent magnets. That program, supported by a financial outlay of 7,280 crore, was designed to create an integrated manufacturing capacity of 6,000 metric tonnes per annum. The goal is to secure the entire value chain, transitioning raw rare earth oxides into high-performance finished magnets used in electronics, defense, and green energy technologies.
To complement these corridors, the government plans to establish high-tech tool rooms operated by central public sector enterprises at two strategic locations. These facilities are envisioned as digitally enabled automation service bureaus that will handle the design, testing, and large-scale manufacturing of high-precision components. By localizing these processes, the government aims to reduce production costs and enhance technical precision for advanced manufacturing.
The announcement comes as mineral-rich states seek more direct involvement in the sector. During the consultation phase, the Odisha government specifically requested the setup of a Rare Earth Complex within its borders to leverage its significant mineral deposits. The new corridors are expected to bridge the gap between raw material extraction and industrial application, positioning India as a more resilient player in the global supply chain for advanced materials.