The Union Cabinet on Wednesday approved the rationalisation of royalty rates for four key minerals — Graphite, Caesium, Rubidium, and Zirconium — which are vital to India’s clean energy transition and high-tech industries. The move aims to unlock new exploration opportunities, attract private investment, and strengthen the supply chain for critical minerals essential to the nation’s industrial growth.

Revised royalty rates for critical minerals

Under the revised structure, the royalty rate for Caesium has been fixed at 2% of the Average Sale Price (ASP) of Caesium metal contained in the ore produced.
For Graphite, the rate will now depend on the grade — 2% of ASP on ad valorem basis for Graphite with 80% or more fixed carbon, and 4% of ASP for Graphite with less than 80% fixed carbon.

Similarly, Rubidium will attract a 2% royalty on ASP of the contained metal, while Zirconium will be charged at 1% of ASP on the metal content in the ore.

This rationalisation aligns the royalty rates for these minerals with those of other critical and strategic minerals, which generally fall within the 2% to 4% range.

Boost to exploration and domestic production

According to the government, this decision will promote the auction of mineral blocks containing Caesium, Rubidium, and Zirconium — not only unlocking these minerals but also associated resources such as Lithium, Tungsten, Niobium, and Rare Earth Elements (REEs).

Officials said the move will help reduce India’s dependence on imports, enhance mineral security, and create new employment opportunities in the mining and manufacturing sectors.

Importance of critical minerals

Graphite, Caesium, Rubidium, and Zirconium are considered vital for high-technology and green energy applications.
Graphite plays a pivotal role in electric vehicle (EV) batteries, serving as the anode material that determines battery efficiency and charge capacity. However, India currently imports nearly 60% of its Graphite requirements.

At present, nine Graphite mines are operational in the country, while 27 blocks have been successfully auctioned. The Geological Survey of India (GSI) and Mineral Exploration & Consultancy Ltd (MECL) have also handed over 20 additional Graphite blocks for auction, and around 26 more are under exploration.

Zirconium, a corrosion-resistant metal, is used in nuclear energy, aerospace, and healthcare industries. Caesium finds applications in atomic clocks, GPS systems, and medical instruments, while Rubidium is used in fibre optics, telecommunication systems, and night-vision devices.

Alignment with national mineral policy

The revision is in line with India’s broader strategy to strengthen its critical minerals ecosystem under the Mines and Minerals (Development and Regulation) Act, 1957.
Graphite and Zirconium are among the 24 critical and strategic minerals notified under the Act, underscoring their importance in ensuring India’s energy transition and technological advancement.

The Cabinet’s approval also comes ahead of the sixth tranche of critical mineral auctions, for which a Notice Inviting Tender (NIT) was issued on 16 September 2025. The auction includes five Graphite blocks, two Rubidium blocks, and one each of Caesium and Zirconium.

Industry implications and conclusion

By shifting the royalty calculation for Graphite from a fixed per-tonne basis to an ad valorem system, the government ensures that royalties better reflect market price variations across grades. This approach is expected to make the bidding process more rational and transparent, encouraging greater participation from private players.

Industry experts believe the reform will support India’s Atmanirbhar Bharat vision, reduce the supply chain vulnerabilities in the green energy sector, and position India as a key player in the global critical minerals landscape.