The Indian government has announced a new royalty payment scheme for a list of critical minerals in a bid to motivate miners to ramp up local production.
Under the new scheme, miners of graphite would pay royalties as a percentage of the sales price of the mineral rather than a fixed rate as the previous royalty regime prescribed, Bloomberg reported, citing data from the Indian Bureau of Mines. The authority also set royalty rates for caesium, zirconium, and rubidium. Previously, there were no royalty rates specified for these elements.
The purpose of the changes is to reduce India’s dependence on imported critical minerals, the report said, joining a global shift to build and strengthen new supply chains I the critical minerals area to reduce dependence on China, which controls most of the mining and, more importantly, processing capacity for these elements.
Given India’s history with China, a drive to reduce imports from the latter makes sense even if the two are partners in BRICS. As part of that drive, the Modi government earlier this year approved a state investment program worth $1.9 billion to expand the supply of critical minerals for the electronics, defense, battery, and agriculture industries.
Two years ago, the Indian government launched its first-ever auction of tracts containing critical and strategic minerals as it looks to boost its renewable energy rollout and EV uptake and protect its national security.
The Indian Ministry of Mines said at the time that it was auctioning 20 blocks of critical and strategic minerals across the country in a “landmark initiative that will boost our economy, enhance national security and support our transition to a clean energy future.” The auction featured blocks containing lithium, graphite, nickel, molybdenum, and rare earth elements.
“The future global economy will be underpinned by technologies that depend on minerals such as lithium, graphite, cobalt, titanium and rare earth elements (REE). India has committed to achieving 50% of cumulative electric power installed capacity from non-fossil sources by 2030,” the ministry noted.
By Irina Slav for Oilprice.com
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