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Lithium, Niobium and Rare Earth Elements (REEs)

2023 OCT 12

Preliminary   > Geography   >   Resource geography   >   Resource geography

Why in news?

  • The Union Cabinet has approved a royalty rate for three critical and strategic minerals-lithium, niobium, and Rare Earth Elements (REEs). 

About the News

  • Such royalty rate approval will enable Central Government to auction blocks for these critical minerals for the first time in the country
  • Recently, central government delisted six minerals  including Lithium and Niobium, from the list of atomic minerals through the Mines and Minerals (Development and Regulation) Amendment act, 2023, thereby allowing grant of concessions for these minerals to the private sector through auction. 
  • Further, the amendment provided that mining lease and composite license of 24 critical and strategic minerals including Lithium, Niobium and REEs (not containing Uranium and Thorium) shall be auctioned by the Central Government.
  • Second Schedule of Mines and Minerals (Development and Regulation) Act (MMDRA), 1957 deals with the royalty rates of minerals.
  • If not specified, the royalty rate for minerals is 12% of the Average Sale Price (ASP). Now, approved royalty rates for lithium, Niobium, and REE are 3%, 3 %, and 1 %, respectively.
  • Presently, India’s mineral royalty rates are among the highest in the world, thus impacting the competitiveness of sector and putting the economic burden on mining companies.

About Lithium

  • It is the lightest metal and the lightest solid element. Due to its low density, it’s often used in lightweight alloys.
  • Lithium is highly reactive and flammable, particularly when exposed to water or moisture.
  • Lithium is relatively rare in nature, found in various minerals and some saltwater sources. The largest producers of lithium are typically countries with significant lithium reserves, such as Australia, Chile, and China.
  • Lithium is widely used in batteries, particularly in rechargeable lithium-ion batteries, which power many electronic devices and electric vehicles (EVs). It’s also used in some medications for mood disorders, such as bipolar disorder.
  • Lithium is important in nuclear fusion research as it can be used as a fuel for certain types of fusion reactions, potentially providing a source of clean energy in the future.

About Niobium

  • Niobium is relatively abundant in the Earth’s crust, but it is not found in its pure form. It is typically extracted from minerals like columbite and tantalite.
  • Niobium is a lustrous, grey, ductile metal with a high melting point. It is known for its superconducting properties when cooled to low temperatures.
  • Niobium is used in the production of superconducting materials and magnets, making it vital for technologies like MRI machines and particle accelerators.
  • Niobium is often alloyed with other metals, such as steel, to improve their strength and heat resistance.
  • The largest producers of niobium are Brazil and Canada, with significant reserves and mining operations.

About Rare Earth Elements (RREs)

  • It refers to a group of 17-odd minerals that cover ones like scandium, yttrium, and cerium, among others. Most of these are used as catalysts and magnets, with the most common usage being in alloys, glass, electronics, petroleum extraction, electric motors of hybrid and EVS and wind turbines, among others.
  • China has historically been the dominant producer of rare earth elements, accounting for a significant portion of the world’s supply. However, other countries are increasing their production to reduce dependency on China.



Consider the following statements:

  1. In India, Lithium comes under the list of Atomic Minerals.
  2. India is currently the third largest producer of Lithium in the world.

Which of the statements given above is/are correct?

(a) 1 only

(b) 2 only

(c) Both 1 and 2

(d) Neither 1 nor 2