To set royalty rates for lithium, niobium, and rare earth minerals, the Indian government intends to alter the Mines and Minerals (Development and Regulation) Act. For lithium and niobium, the suggested royalty rate is 3%, while for rare earth minerals, it is 1%.
This action aims to promote more commercial mining of rare earth minerals by the private sector. The production of solar panels and electric vehicles depends on the mineral lithium, and India is confident that it can be obtained domestically.
Massive lithium reserves have recently been found in Jammu and Kashmir by the government. The MMDR (Amendment) Bill 2023, which will make it easier to auction off mining concessions for essential minerals, was approved by Parliament in August 2023.
In addition, an exploration license for underground and vital minerals was added by the revisions. Additionally, it left out six minerals from the list of 12 atomic minerals listed in Part-B of the First Schedule of the Act, including minerals and ores that contain lithium, titanium, beryl and other beryllium, niobium, tantalum, and zirconium.
The MMDR Act’s proposed change is a step in the right direction toward encouraging the growth of India’s lithium, niobium, and rare earth minerals industry. The development of the nation’s renewable energy and technology sectors depends on these minerals. The government can improve the environment for private enterprises to invest in by regulating royalty rates for these minerals.
India will be less reliant on importing these important minerals as a result, and indigenous production will increase. Additionally, it will bring in income for the government and create jobs.