Policy Shift Targets Supply-Chain Vulnerability
In November 2025, the Indian Union Cabinet approved a rationalization of royalty rates for four key minerals—Graphite, Caesium, Rubidium and Zirconium—integral to high-tech and energy- transition industries. Under the new framework, royalties are now set at 1–4 % of the Average Sale Price (ASP) of the metal content, replacing previously higher or fixed per-ton rates. The reform signals India’s intention to accelerate domestic mining, reduce import dependence, and align with global competition over strategic minerals.
Rewriting the Economics of Mining for Strategic Metals
For graphite, royalty now stands at 2% of ASP for ore with 80%+ fixed carbon and 4% for lower grade material. Caesium and rubidium face 2% of ASP, while zirconium is set at 1% of ASP. By shifting from flat-fee to ad-valorem royalties, the government aims to make auctions more predictable, improve miner economics, and unlock investments in blocks that were previously deterred by high or unclear fiscal burdens.
Strategic Implications for India and Global Markets
The move comes at a time when global supply chains for critical minerals are under pressure and processing dominance remains concentrated in a few countries. For India, ramping up domestic production of these minerals means advancing its ambitions in batteries, electronics, defense and renewable technologies. However, royalty reform is only one piece of the puzzle: execution will depend on exploration, mining infrastructure, downstream processing and investor confidence. If successfully implemented, this policy may mark a turning point in India’s journey from importer to producer of strategic mineral inputs.