'Govt must keep non-serious firms out of magnet scheme'

Sona Comstar MD says Centre should consider ‘ring-fencing’ this sector through safeguard duties in future

- DEEPAK PATEL

‘The Ministry of Heavy Industries (MHI) must ensure that ‘non-serious’ companies are kept out of its new production-linked incentive (PLI) scheme for rare-earth permanent magnets (REPMs) like in some other PLI schemes, said Vivek Vikram Singh, managing director (MD) and group chief executive officer (CEO) of auto component maker Sona Comstar.

REPM is a sensitive sector for the country and producing high-quality magnets is highly complex and technologically challenging, he added.

Moreover, the Centre should consider “ring-fencing’ this sector through safeguard duties once REPM production starts in India in a couple of years. This will ensure that the new magnet manufacturing industry does not get killed as soon as it takes birth, Singh told Business Standard.

Last Wednesday, the Union Cabinet approved the ‘scheme to promote manufacturing of sintered REPM’. Under this, financial incentives — both capital subsidy and sales-based incentives — will be provided to winning bidders (private players) who set up five manufacturing plants with a combined REPM production capacity of 6,000 tonnes per year.

Singh said Sona Comstar is “interested” in bidding under the scheme and a final decision will be taken after consultations within the board.