Cabinet Approves Rationalization of Royalty Rates for Critical Minerals Worth Graphite, Caesium, Rubidium, and Zirconium to Boost Green Energy
India revises royalty rates for Graphite, Caesium, Rubidium, and Zirconium to strengthen green energy, reduce imports, and boost domestic mineral production.
TheInterviewTimes.com | November 13, 2025 — The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the rationalization of royalty rates for four critical minerals — Graphite, Caesium, Rubidium, and Zirconium — to strengthen India’s green energy transition and reduce import dependence. The move aligns with the government’s long-term vision of building a self-reliant critical minerals supply chain for high-tech and renewable energy industries.
The Cabinet has revised royalty rates for Graphite, Caesium, Rubidium, and Zirconium to encourage mineral block auctions, increase domestic production, and support India’s energy transition goals. These minerals are vital for sectors like electric vehicles, electronics, aerospace, and nuclear energy.
Key Points
- New royalty rates fixed for Graphite, Caesium, Rubidium, and Zirconium to encourage mining and exploration.
- Graphite royalty shifted to ad valorem basis to reflect market price variations.
- Move to boost indigenous mineral production, reduce import dependence, and create jobs.
- Critical for green energy, electric vehicles, atomic clocks, fibre optics, and nuclear power.
- Decision to support upcoming auctions of Graphite, Caesium, Rubidium, and Zirconium blocks.
Revised Royalty Rates for Critical Minerals
The Cabinet approved the following royalty structure to ensure fair, transparent, and market-aligned mineral development:
| Mineral | Royalty Rate |
| Caesium | 2% of Average Sale Price (ASP) of Caesium metal chargeable on Caesium metal contained in the ore produced |
| Graphite (≥80% fixed carbon) | 2% of ASP on ad valorem basis |
| Graphite (<80% fixed carbon) | 4% of ASP on ad valorem basis |
| Rubidium | 2% of ASP of Rubidium metal chargeable on Rubidium metal contained in the ore produced |
| Zirconium | 1% of ASP of Zirconium metal chargeable on Zirconium metal contained in the ore produced |
This rationalization will promote auction of mineral blocks containing Caesium, Rubidium, and Zirconium, unlocking associated critical minerals such as Lithium, Tungsten, Rare Earth Elements (REEs), and Niobium.
#Cabinet approves rationalization of royalty rates of Graphite, Caesium, Rubidium and Zirconium minerals critical for Green Energy
— PIB India (@PIB_India) November 12, 2025
-Union Minister @AshwiniVaishnaw #CabinetDecisions pic.twitter.com/UUHJg2CnA8
Boosting Domestic Mining and Reducing Imports
The move is expected to increase indigenous production, reduce import dependence, and generate employment opportunities. These minerals are essential for high-technology industries and green energy applications, making them vital for India’s sustainable growth strategy.
- Graphite is a key component of electric vehicle (EV) batteries, used as an anode material enabling high conductivity and charge capacity. India currently imports nearly 60% of its Graphite demand. There are 9 operational mines and 27 auctioned Graphite blocks, while 20 more blocks are ready for auction and 26 under exploration.
- Zirconium is widely used in nuclear energy, aerospace, healthcare, and manufacturing due to its corrosion resistance and temperature stability.
- Caesium is vital for atomic clocks, GPS systems, and medical devices like cancer therapy equipment.
- Rubidium finds applications in specialty glass, fibre optics, and night vision systems.
Facilitating Critical Mineral Auctions
The Central Government recently issued a Notice Inviting Tender (NIT) on 16th September 2025 for the Sixth Tranche of critical mineral block auctions, which includes:
- 5 Graphite blocks
- 2 Rubidium blocks
- 1 Caesium block
- 1 Zirconium block
The Cabinet’s decision on royalty rates will help potential bidders make informed financial submissions during the auction process, promoting transparency and investor confidence in India’s mining sector.
Why the Royalty Rationalization Matters
Previously, Graphite was the only critical mineral with a royalty rate fixed per tonne since 2014. The new ad valorem structure ensures that royalties fluctuate with market prices, creating a fair and adaptive system.
This update aligns with the recent government trend of setting royalty rates for critical minerals between 2% and 4%, balancing state revenue with investor attractiveness.
Strategic Importance for India’s Green Energy Vision
Graphite and Zirconium are part of the 24 critical and strategic minerals listed under the Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act). Their expanded production is essential for:
- Electric mobility and renewable energy storage
- High-precision electronics and defense manufacturing
- Advanced healthcare and nuclear applications
By encouraging domestic exploration and reducing dependency on imports, this initiative supports India’s commitment to green technology, clean energy manufacturing, and the Atmanirbhar Bharat vision.
Conclusion
The Cabinet’s decision to rationalize royalty rates for Graphite, Caesium, Rubidium, and Zirconium marks a key reform in India’s critical minerals policy. It will strengthen the country’s position in the global supply chain for green energy and high-tech manufacturing, while ensuring long-term resource security, employment generation, and industrial competitiveness.