Thiruvananthapuram: The union budget has announced a combined scheme to promote the creation of a dedicated rare earth corridor to promote mining, processing
and research in Kerala along with Odisha and AP will help the coastal state as it could bring a huge revenue to the state.
Speaking in her budget, 2026-27, union finance minister Nirmala Sitharaman said, “The scheme for rare earth permanent magnets, launched in November 2025 will now be supported through state-specific corridors to promote mining, processing and research and manufacturing”.
Kerala with its abundant coastal deposits of Thorium, scandium and other rare earth elements is set to play a central role in the initiative. During the Kerala budget speech on January 29, state finance minister KN Balagopal highlighted that these minerals are crucial for space research, energy, defense, aviation and health-care technologies such as CT scanners. He added that plans are underway to establish a rare-earth corridor linking Vizhinjam port to Chavara, with a connection to Cochin, positioning Kerala as the nation’s permanent magnet hub.
Kerala finance minister also announced a ‘Rare Earth Critical Mission’ in partnership with KMML, KELTRON and NFTDC supported by an investment of Rs 100 crore.
Experts believe that the new announcement will attract more revenue towards the state. Kerala government expects that the corridor is expected to attract investments worth Rs 42,000 crore and generate around 50,000 jobs boosting both the economy and the state’s strategic industrial capabilities.
Rare earth – a group of 17 critical elements – are essential for applications ranging from smart phones, electric vehicles, drones, defense system and fighter jets.
China currently dominates global production, accounting for nearly 60% of mining output, nearly 90% of refined products and rare earth magnets, leaving other countries vulnerable for supply disruptions.
