In a first, India is set to propose revised royalty rates for three key off-shore minerals — construction sand, limestone & lime-mud and poly-metallic nodules — ahead of the upcoming auctions.
The proposed royalty rates are around ₹40 per tonne for construction sand, ₹50 per tonne for lime mud, and poly-metallic nodules and crust are proposed to be at 3 per cent of the average sale price on an ad valorem basis, according to a Cabinet note reviewed by businessline.
Plans for offshore mineral block auctions are likely to take off once these royalty rates are approved, sources said. So far approximately 13 blocks across three offshore minerals have been identified, primarily for auction purposes.
Over-burden waste will be disposed at a rate of ₹10 per tonne.
“There are no financial implications.... in terms of any recurring or non-recurring expenditure,” the note reads, adding that: “Rationalisation of royalty would enable auction of offshore mineral blocks for the first time in the country.”
Indigenous production of these minerals — some of which are of strategic importance — “will ensure raw material availability”. “It will enable import substitution thereby promoting the goal of Atmanirbhar Bharat,”it added.
Lime Mud
Three lime-mud off the West Coast in Gujarat have been selected for auction. All three are located near Porbandar, lying beyond the territorial waters and within India’s Exclusive Economic Zone. Apart from Gujarat, some presence of lime mud sources has been reported off Maharashtra too, as per GSI findings report.
Used primarily as blast furnace material required in steel-making, India relies on imports for lime-mud supplies. Imports were at ₹6.259 crore in FY23 up nearly 30 per cent y-o-y, from ₹4,902 cr in FY22.
Poly-metallic Nodules
Seven poly-metallic nodule blocks have been identified and all are located off Nicobar Island, off Andaman Sea.
These nodules are crucial in the manufacture of low-carbon tech and remain a cornerstone towards India’s transition to clean energy.
Poly-metallic nodules are marine mineral sedentary mineral deposits comprising iron and manganese oxy-hydroxides. Apart from iron and manganese, other minerals of economic and commercial interest include nickel, cobalt, and copper. The nodules also contain lithium, molybdenum, titanium and other rare earth elements. India relies on imports for all critical minerals.
Construction Sand
The remaining three blocks of construction sand have been identified in the Kollam area of Kerala. Construction sand is used exclusively in construction purposes.
The average selling price of sand across coastal States of India is around ₹55 per tonne.