The Union Cabinet approved changes to the royalty rates for critical minerals, including graphite, caesium, rubidium, and zirconium, on Wednesday, aiming to enhance production.
For graphite, two categories were established: a 2% royalty on the average sale price (ASP) for graphite with 80% or more fixed carbon, and a 4% rate for those with less than 80% fixed carbon. The royalty for caesium is also set at 2% of the ASP based on the contained caesium metal in the ore produced. The same will apply to rubidium, while zirconium will have a 1% rate, according to a government statement.
“This decision will promote the auction of mineral blocks containing caesium, rubidium, and zirconium, thus unlocking these minerals, as well as associated critical minerals like lithium and tungsten,” the statement noted. The royalty structure based on the ASP allows for a proportional response to changes in mineral prices across different grades. Increased domestic production is expected to reduce reliance on imports, mitigate supply chain vulnerabilities, and create job opportunities in the country.
Graphite, caesium, rubidium, and zirconium are vital for high-tech applications and energy transition. Both graphite and zirconium are listed among the 24 critical and strategic minerals in the Mines and Minerals (Development and Regulation) Act, 1957. Graphite serves as a crucial component in electric vehicle (EV) batteries, acting as the anode material which enhances conductivity and charge capacity. Currently, India imports 60% of its graphite needs, with nine graphite mines operational and 27 blocks successfully auctioned. The Geological Survey of India (GSI) and the Mineral Exploration Corporation Limited (MECL) have transferred 20 graphite blocks for future auction, while about 26 blocks are under exploration.
Zirconium is utilized across various sectors, including nuclear energy and healthcare, due to its exceptional corrosion resistance and high-temperature stability. Caesium is mainly used in high-precision electronics, such as atomic clocks and GPS systems, while rubidium is key in manufacturing specialty glasses for fiber optics and telecommunications.
Recently, the central government issued a Notice Inviting Tender (NIT) on September 16, 2025, for the sixth tranche of auctions for critical mineral blocks, which includes five graphite blocks, two rubidium blocks, and one each of caesium and zirconium. The Cabinet’s recent approval of the royalty rates will assist bidders in submitting informed financial offers during the auction.
Since September 1, 2014, the royalty rate for graphite has been based on a per-tonne structure, making it the only mineral in the critical and strategic minerals list to have such a specification.
Published on November 12, 2025.
