Gujarat mineral shares rise 7% on Sitharaman’s rare earth corridor push

Shares of Gujarat Mineral Development Corporation (GMDC) jumped 7% on February 1, touching an intraday high of ₹618, after Finance Minister Nirmala Sitharaman outlined fresh measures to strengthen India’s rare earth ecosystem in the Union Budget.In her Budget speech, Sitharaman proposed the creation of dedicated rare earth corridors across Tamil Nadu, Kerala, Odisha and Andhra Pradesh, signalling an intensified push to build domestic capacity and reduce India’s dependence on imports, particularly from China. The announcement boosted investor interest in mining and mineral stocks, with GMDC emerging as a key gainer during the session.
India is among a growing group of countries seeking to secure a larger share of the rare earth magnet supply chain, a sector currently dominated by China. According to the International Energy Agency, China controls about 60% of global rare earth mining and more than 90% of processing capacity, giving it a near-monopoly over the critical materials used in electric vehicles, wind turbines and advanced electronics.The Budget announcement builds on earlier policy steps taken by the government. In November 2025, the Union Cabinet approved a ₹7,280-crore incentive scheme aimed at boosting domestic production of rare earth magnets. The programme targets the creation of an annual manufacturing capacity of 6,000 metric tonnes to address supply shortages and support downstream industries.
India has one of the world’s largest rare earth reserves, estimated at around 6.9 million tonnes, and is among the top three countries globally with significant ‘placer deposits’—rare earth-rich mineral sands found along coastal beaches. The government has stepped up efforts to source rare earth magnets locally after China imposed export restrictions on seven key rare earth elements in April 2025, following US tariff sanctions.Industry experts, however, note that scaling up rare earth manufacturing comes with challenges. The value chain—from mining rare earth oxides to processing alloys and producing magnets—is highly energy-intensive and generates toxic waste, requiring strong environmental safeguards and advanced processing capabilities.Even so, the Budget’s focus on rare earth corridors has reinforced expectations of policy support for the sector, driving renewed interest in mining companies such as GMDC that stand to benefit from India’s strategic push in critical minerals.

(State Correspondent)