In a landmark initiative to boost the economy, enhance national security and support transition to a clean energy future, the Ministry of Mines will be launching the first tranche auction of critical and strategic minerals on November 29 with 20 blocks of critical and strategic minerals being auctioned across the country.
As chief guest, Union Minister of Coal Pralhad Joshi will be launching the first-ever critical minerals auction process.
“Critical minerals are essential for our country’s economic development and national security. The lack of availability of these minerals or concentration of their extraction or processing in a few countries may lead to supply chain vulnerabilities. The future global economy will be underpinned by technologies that depend on minerals such as lithium, graphite, cobalt, titanium and rare earth elements (REE),” Ministry of Mines said in a statement.
India has committed to achieve 50 per cent of cumulative electric power installed capacity from non-fossil sources by 2030. Such ambitious plan for energy transition is set to drive the demand for electric cars, wind and solar energy projects and battery storage systems thereby increasing the demand for these critical minerals, it added.
Notably, the critical and strategic minerals are in high demand and the same is usually met by imports. Critical minerals cater to the needs of sectors like renewable energy, defence, agriculture, pharmaceutical, high-tech electronics, telecommunications, transport, creation of gigafactories etc.
Recently, through an amendment in the MMDR Act on 17th August 2023, 24 minerals were notified as Critical and Strategic minerals.
The amendment confers the power to grant mineral concession of these minerals to Central government so that it could prioritise auction of these minerals looking at the requirements of the country.
The revenue generated from these auctions shall accrue to State Governments. Subsequently, royalty rates of critical minerals have been rationalized to encourage more participation in auctions.
According to the ministry release, the Government had specified royalty rates for Platinum Group of Metals (PGM) at 4 per cent, Molybdenum at 7.5 per cent, Glauconite and Potash at 2.5 per cent in March, 2022. On 12th October, 2023 the government specified royalty rates for Lithium at 3 per cent, Niobium at 3 per cent and Rare Earth Elements at 1 per cent.
Details of the mineral blocks, auction terms, timelines etc. can be accessed on MSTC auction platform.