Centre Revises Royalty Rates to Boost Domestic Production of Critical Minerals

The Union Cabinet has approved the rationalization of royalty rates for key critical minerals, including graphite, caesium, rubidium, and zirconium, aiming to accelerate domestic production. These minerals are essential for advanced technological applications and the global energy transition, with graphite and zirconium listed among the 24 critical minerals under the Mines and Minerals (Development and Regulation) Act, 1957.

Under the new structure, caesium, widely used in high-precision electronic devices and medical equipment, will have a royalty rate of two per cent of its average sale price. Graphite, a key component in electric vehicle batteries, will attract a royalty of two per cent for 80 per cent or higher fixed carbon content and four per cent for lower-grade graphite. Rubidium and zirconium, critical for fiber optics, aerospace, nuclear energy, and healthcare, will have royalty rates set at two per cent and one per cent of the average sale price, respectively.

India currently imports around 60 per cent of its graphite requirement, but efforts are underway to boost domestic mining, with several blocks operational, auctioned, or under exploration. The revised rates are expected to encourage financially viable bids in upcoming auctions, promote investment, and strengthen self-reliance in the country’s critical minerals sector.

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