NEW DELHI: In a bid to accelerate the domestic production of rare earth and critical minerals, the Centre has approved the rationalization of royalty rates for graphite, caesium, rubidium, and zirconium—minerals that are essential for high-tech industries and green energy technologies.
Graphite, caesium, rubidium, and zirconium are vital for advanced technological applications and the ongoing global energy transition. Notably, graphite and zirconium are among the 24 critical and strategic minerals listed in the Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act).
According to the decision, the royalty rate for caesium—used mainly in high-tech electronic sectors, particularly in atomic clocks, GPS systems, high-precision instruments, and medical equipment including cancer therapy devices—has been fixed at two per cent of the average sale price of caesium metal, chargeable on the caesium metal contained in the ore produced.
For graphite, a crucial component in electric vehicle (EV) batteries, the royalty rate has been differentiated based on the fixed carbon content. Graphite with eighty per cent or more fixed carbon will attract a royalty of two per cent of the average sale price on an ad valorem basis, while graphite with less than eighty per cent fixed carbon will attract a royalty of four per cent of the average sale price on an ad valorem basis.
India currently imports about 60 per cent of its graphite requirement. At present, nine graphite mines are operational in the country, and 27 additional blocks have been successfully auctioned. Furthermore, the Geological Survey of India (GSI) and Mineral Exploration and Consultancy Limited (MECL) have handed over 20 graphite blocks for auction, while around 26 blocks are under exploration.
The royalty rate for rubidium—used in the manufacture of specialty glasses for fibre optics, telecommunication systems, and night-vision devices—has been specified as two per cent of the average sale price of rubidium metal, chargeable on the rubidium metal contained in the ore produced.
For zirconium, a versatile metal used across industries such as nuclear energy, aerospace, healthcare, and manufacturing, the royalty rate has been set at one per cent of the average sale price of zirconium metal, chargeable on the zirconium metal contained in the ore produced.
Recently, the Centre issued a Notice Inviting Tender (NIT) on 16th September for the sixth tranche of auctions for critical mineral blocks. This tranche includes five graphite blocks, two rubidium blocks, and one block each of caesium and zirconium.
The Union Cabinet’s approval of the revised royalty rates will help prospective bidders to submit financially rational bids during the upcoming auctions, thereby promoting investment, self-reliance, and sustainable growth in the country’s critical minerals sector.