On 12 November 2025, the Union Cabinet chaired by the Prime Minister (PM) Narendra Modi, approved the rationalisation of royalty rates for four critical minerals Graphite, Caesium, Rubidium, and Zirconium to boost domestic production and reduce import dependence.
- The Union Cabinet also passed a resolution condemning the terrorist car explosion near the Red Fort in New Delhi(Delhi) on 10 November 2025, commending the swift action of security agencies, medical personnel, and citizens, and reaffirming India’s unwavering policy of zero tolerance towards terrorism.
Exam Hints:
- What? Cabinet approves rationalised royalty rates for Graphite, Caesium, Rubidium, Zirconium
- Approved by: Union Cabinet chaired by PM Narendra Modi
- Aim: Boost domestic production, reduce import dependence, promote mineral block auctions
- Royalty Rates:
- Graphite (≥80% C): 2% of ASP ; Graphite (<80% C): 4% of ASP
- Caesium: 2% of ASP
- Rubidium: 2% of ASP
- Zirconium: 1% of ASP
- Graphite Royalty: Shifted from per tonne to ad valorem basis to reflect price variations
- Graphite Mining: 9 operational mines, 27 auctioned blocks, 20 blocks for future auctions
About Rationalisation of Royalty Rates :
Purpose: To boost domestic mining and production, reduce import dependence (especially for Graphite, 60% imported), promote transparent mineral block auctions, and enhance India’s energy and supply chain security.
Rationale: The rationalisation seeks to boost mineral block auctions, unlock critical minerals, attract investment, and support India’s green energy transition with a fair ad valorem Graphite royalty.
Graphite Royalty Moves to Ad Valorem Basis: Initially fixed per tonne since 1 September 2014, Graphite, the sole critical mineral with a per‑tonne rate, will now follow an ad valorem structure to account for price variations across grades.
Alignment: This decision aligns with the National Critical Minerals Mission(NCMM) and the Atmanirbhar Bharat initiative.
Legal Listing: These minerals are vital for Electric Vehicles (EVs), electronics, high-tech, and strategic sectors, with Graphite and Zirconium listed among the 24 Critical and Strategic Minerals under the the Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act, 1957).
Royalty Rates for Critical and Strategic Minerals:
| Mineral | Royalty Rates | Basis |
|---|---|---|
| Caesium | 2% of the Average Sale Price (ASP) | Chargeable on the Caesium metal contained in the ore produced |
| Graphite (≥80% Fixed Carbon) | 2% of the ASP | On an ad valorem basis (value-based royalty) |
| Graphite (<80% Fixed Carbon) | 4% of the ASP | |
| Rubidium | 2% of the ASP | Chargeable on the Rubidium metal contained in the ore produced |
| Zirconium | 1% of the ASP | Chargeable on the Zirconium metal contained in the ore produced |
Mineral Details:
Graphite:
- Use: Anode material in EV batteries.
- Import: 60% imported by India.
- Graphite Mining Status: 9 working mines, 27 auctioned blocks, 20 handed over (Geological Survey of India, GSI/Mineral Exploration and Consultancy Limited, MECL), 26 under exploration.
Zirconium:
- Use: In nuclear energy, aerospace, healthcare, and manufacturing.
- Feature: High corrosion resistance and temperature stability.
Caesium:
- Use: In atomic clocks, GPS systems, medical devices (e.g., cancer therapy).
Rubidium:
- Use: In fibre optics, telecom systems, and night-vision devices.
Key Notes:
Royalty Rate: A government-imposed charge on mineral producers for extracting natural resources, calculated either as a percentage of the Average Sale Price (ASP) or on a fixed per-tonne basis.
Average Sale Price (ASP): It is the weighted average of the ex‑mine prices of a mineral grade or concentrate in a month, calculated from non‑captive and captive merchant sales.
