The Union Cabinet has approved the rationalisation of royalty rates for four key minerals, Graphite, Caesium, Rubidium, and Zirconiun, to promote auction of critical mineral blocks.

What is Royalty Rate?

• Royalty is a payment made by miners to the government for extracting minerals that are owned by the State.
• It is essentially the charge or tax imposed on the quantity or value of minerals produced.
• The Royalty Rate determines how much the miner must pay, usually expressed as a percentage of the Average Sale Price (ASP) of the mineral (ad valorem basis) or as a fixed amount per tonne.

Why Rationalisation Needed ? 

• India is heavily import-dependent for several critical minerals.
  • India imports around 60% of Graphite.
• Needed to strengthen domestic supply chains for green technologies (batteries, EVs, solar).
• Aligns with India’s Atmanirbhar Bharat, Net Zero 2070, and Critical Minerals Strategy.
• Ensures competitive rates comparable with global standards to attract investment.

Significance of the Decision

• Promotes Mineral Block Auctions: Rationalised royalty rates will boost auction of blocks containing Caesium, Rubidium, Zirconium, and associated critical minerals such as Lithium, Tungsten, REEs, Niobium, etc.
• Boosts Domestic Production: Enhanced indigenous output will Reduce supply chain vulnerabilities, Lower imports, Generate employment.
• Alignment with Critical Mineral Strategy: Graphite and Zirconium are among the 24 critical and strategic minerals notified under the Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act).

About Graphite

• Category: Non-metal (allotropes of carbon)
• Key Properties:
  • Structure: Graphite is made up of layers of carbon atoms arranged in a hexagonal lattice, where each carbon atom is bonded to three others.
  • Conductivity: Good conductor of electricity and heat due to the mobility of electrons between the layers.
  • Strength and Flexibility: Soft and slippery in nature, which makes it useful as a lubricant.
  • High melting point: Resistant to high temperatures and is chemically stable.
• Applications:
  • Batteries: Key component in lithium-ion batteries.
  • Refractories: Used in high-temperature applications like steel production.
  • Electrodes: Employed in electric arc furnaces and as electrodes in electrolysis processes.
  • Composites: Used in materials that require lightness, strength, and heat resistance.

About Caesium (Cesium)

• Category: Alkali metal
• Key Properties:
  • Soft, Silver-Golden Metal: Caesium is a soft metal and is the least dense liquid metal.
  • Highly Reactive: Extremely reactive, especially with water. Forms caustic hydroxides when it reacts with water.
  • Low Melting Point: Has a relatively low melting point (28.4°C), making it one of the few metals that are liquid at room temperature.
• Applications:
  • Atomic Clocks: Used in highly accurate atomic clocks, which are crucial for GPS systems and scientific research.
  • Medical Applications: Used in radiotherapy for certain cancer treatments.
  • Research: Employed in some research fields to study atomic interactions.

About Rubidium

• Category: Alkali metal
• Key Characteristics:
  • Soft and Silvery: Rubidium is a soft, silvery-white metallic element that is highly reactive and burns easily in the air.
  • Highly Reactive: Similar to Caesium, rubidium is highly reactive, especially with water and air.
  • Low Melting Point: It has a relatively low melting point and is soft enough to be cut with a knife.
• Applications:
  • Glass Manufacturing: Used in special types of glass, particularly for devices such as cell phones and electronics.
  • Ion Engines: Employed in ion propulsion systems for spacecraft.
  • Medicine: Sometimes used in therapeutic treatments, although its use is less common than other alkali metals.
  • Research: Rubidium is used in research, particularly in the fields of atomic clocks and quantum mechanics.

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About Zirconium

• Category: Transition metal
• Key Properties:
  • Hard, Silvery Metal: Zirconium is a strong, shiny, grayish-white metal with a high melting point.
  • Corrosion Resistance: Very resistant to corrosion and is highly stable at high temperatures.
  • Strong and Ductile: Although strong, it is ductile and can be shaped easily.
• Applications:
  • Nuclear Industry: Zirconium is used as a material for cladding nuclear fuel rods due to its low neutron absorption cross-section.
  • Aerospace and Defense: Employed in aerospace materials and military applications due to its high strength and heat resistance.
  • Chemical Industry: Used as a catalyst in the chemical industry, especially for reactions involving chlorine and other reactive chemicals.

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