New Delhi: Industry executives said the Union Budget’s focus on rare earths and critical minerals strengthens India’s supply-chain security for renewables, electric mobility and advanced manufacturing. “Dedicated rare earth corridors were proposed across Odisha, Andhra Pradesh, Tamil Nadu and Kerala to secure critical minerals essential for renewables, EVs and high-tech manufacturing,” said Dr Faruk G Patel of KP Group.
The Budget proposed supporting mineral-rich states to establish dedicated rare earth corridors covering mining, processing, research and manufacturing. “A Scheme for Rare Earth Permanent Magnets was launched in November 2025. We now propose to support the mineral-rich States of Odisha, Kerala, Andhra Pradesh and Tamil Nadu to establish dedicated Rare Earth Corridors to promote mining, processing, research and manufacturing,” said Finance Minister Nirmala Sitharaman while presenting Budget 2026-27.
It also announced basic customs duty exemptions on capital goods required for processing critical minerals in India. The government also proposed incentives for prospecting and exploration of critical minerals by allowing deductions for exploration expenditure.
Dr Chetan Shah, Chairman and Managing Director of Solex Energy Limited, said the measures provide predictability for domestic manufacturers. “By extending customs duty exemptions for batteries, energy storage systems, critical mineral processing, and nuclear infrastructure, the government has provided long-term policy certainty that will accelerate domestic value addition and global-scale manufacturing in India,” Shah said.
He added that the focus on value-chain localisation aligns energy security with industrial competitiveness.
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