The Centre has relaxed localisation rules under the PM E-DRIVE scheme, allowing electric bus and truck makers to import traction motors with rare-earth magnets till August 31. The move comes as manufacturers continue to face supply constraints.
In notifications issued on March 13, the Ministry of Heavy Industries extended the deadline to stop imports of traction motors used in electric trucks (N2/N3) and buses (M2/M3). This is the second such extension. The earlier deadline had already been pushed to March 2026.
Breather for manufacturers
The decision is expected to ease pressure on manufacturers dealing with shortages of key components, especially rare-earth magnets used in traction motors.
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According to a report by Moneycontrol, these magnets remain a critical input not only for electric vehicles but also for sectors such as electronics, aerospace and clean energy. Industry players have flagged ongoing challenges in securing steady supplies.
Localisation timeline pushed
Under the Phased Manufacturing Programme (PMP) of the PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) scheme, companies are required to carry out key stages of traction motor production within India. The guidelines state that the "manufacturing of traction motor which at least includes magnet fitment, fitment of rotor assembly into motor, fitment of stator assembly into motor, shaft fitment, bearing fitment, enclosure fitment, connectors fitment, cables fitment shall be domestically performed."
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The latest revision shifts the enforcement of these localisation requirements to September 1, 2026, giving companies more time to scale up domestic production.
Even as it extends relief, the government has maintained its focus on cutting dependence on imports of rare-earth magnets, particularly from China.
To support domestic capacity, it has already notified a separate scheme to promote the manufacturing of sintered rare earth permanent magnets (REPM), with an outlay of Rs 7,280 crore.
