Cabinet approves new royalty rates for critical minerals graphite, caesium, rubidium and zirconium

The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved the rationalisation of royalty rates for four critical minerals — graphite, caesium, rubidium and zirconium — in a move aimed at promoting the auction and domestic production of these minerals used in high-tech and green energy applications.

According to the government’s decision, the royalty rates have been specified or revised as follows: caesium and rubidium will each attract a 2% royalty based on the average sale price (ASP) of the respective metal contained in the ore produced. Zirconium will have a royalty rate of 1% of ASP, while graphite will be charged 2% of ASP on an ad valorem basis for ore with 80% or more fixed carbon and 4% for ore with less than 80% fixed carbon.

The new royalty structure is expected to encourage the auction of mineral blocks containing caesium, rubidium and zirconium, thereby unlocking these and other associated critical minerals such as lithium, tungsten, rare earth elements and niobium. The move is also expected to boost domestic production, reduce import dependence, and create employment opportunities.


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Graphite and zirconium are among the 24 critical and strategic minerals listed in the Mines and Minerals (Development and Regulation) Act, 1957. Graphite, a key material in electric vehicle batteries, is currently imported to meet 60% of India’s requirements. Nine graphite mines are operational in the country, while 27 blocks have been successfully auctioned and another 20 are ready for auction.

Zirconium, used across industries including nuclear energy, aerospace and healthcare, is valued for its corrosion resistance and high-temperature stability. Caesium is used in atomic clocks, GPS systems and medical equipment, while rubidium finds applications in specialty glasses, fibre optics and night vision devices.

The Cabinet noted that royalty rates for most critical minerals are currently in the range of 2% to 4%. The shift to an ad valorem system for graphite — replacing the earlier per-tonne rate fixed in 2014 — is intended to better reflect variations in market prices across different grades.

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The decision comes as the government advances the Sixth Tranche of auctions for critical mineral blocks, notified on September 16, 2025. The tranche includes five blocks of graphite, two of rubidium, and one each of caesium and zirconium.