India's federal government plans to fix the rate of royalty that mining companies must pay for extracting lithium at 3% of the prices prevailing at the London Metal Exchange (LME), two government sources said.
India, which has been exploring ways to secure supplies of lithium - a critical raw material used to make electric vehicle batteries - in February found its first lithium deposits in the federally administered region of Jammu and Kashmir. The government is expected to auction the newly found lithium blocks, with estimated reserves of 5.9 million tonnes, later this year.
At least a dozen Indian and foreign companies such as Adani Enterprises, Vedanta Ltd, Reliance Industries, Jindal Steel and Power Ltd, Himadri Chemicals and Korea's LX International are likely to take part in the auction, said the sources, asking not to be named as the information is not public.
India's cabinet is expected to consider the proposal of fixing the rate of royalty for lithium mining at 3% of the rates prevailing at LME, they said. The Ministry of Mines did not immediately respond to a request for comment.
