India revamps critical mineral royalties to boost local mining

India approved changes to royalty rates for several critical minerals, as part of efforts to boost domestic mining and reduce the nation’s heavy reliance on imports.

Under the revised system, the royalties — the fees miners pay to local authorities for extraction — on graphite will be charged as a percentage of sale prices decided by the Indian Bureau of Mines, instead of a fixed value per ton. The government also set the rates for caesium, zirconium and rubidium, it said in a statement. Currently, there’s no royalty rate specified for these elements.

The new rates will help the bidders submit more rational offers in auctions, the government said. An increase in domestic production of these minerals would lead to a reduction in imports and supply chain vulnerabilities, it added.

New Delhi is stepping up efforts to secure critical mineral supply chains as demand for clean-energy materials accelerates worldwide. India remains a small producer of most critical minerals, including graphite, of which the country currently imports about 60% of its needs.

Prime Minister Narendra Modi’s government is seeking to attract private and foreign investment into mining projects and reduce its reliance on imports from China, which dominates the global market for processing. It approved a $1.9 billion program to secure supplies of a range of minerals, used mainly in the battery, electronics, defense and agriculture sectors, earlier this year.

(By Preeti Soni)