New Delhi, Oct 11 (IANS): The Central government is likely to amend the Mines and Minerals (Development and Regulation) Act, to fix royalty rates for lithium, niobium and rare earth minerals.

According to sources, the Union Cabinet is likely to clear the proposal during its meeting on Wednesday.

The royalty could be 3 per cent each for lithium and niobium while for rare earth minerals it could be 1 per cent.

The move is aimed at encouraging greater private sector participation in commercial mining of rare earth minerals.

Recently huge reserves of lithium was discovered in Jammu and Kashmir.

Lithium is used for manufacturing batteries for electric vehicles and government is bullish towards sourcing it from within the country and also abroad.

In August, Parliament had passed the MMDR (Amendment) Bill 2023, which will facilitate auction of mineral concessions for critical minerals, while states will get the revenue.

The amendments also introduced exploration licence for deep-seated and critical minerals.

It also omitted six minerals from the list of 12 atomic minerals specified in Part-B of the First Schedule of the Act, namely, lithium bearing minerals, titanium bearing minerals and ores, beryl and other beryllium bearing minerals, niobium and tantalum bearing minerals and zirconium-bearing minerals.