NEW DELHI: The government will launch the auction of critical and strategic mineral blocks on Monday, as it aims to safeguard key sectors such as clean energy and defence from supply disruptions caused by trade and geopolitical tensions.
In the seventh round of auctions, the Union mines ministry will offer 19 blocks across multiple states under mining lease and composite licence, with revenues accruing to the respective states.
These blocks comprise a diverse basket of minerals essential for sectors such as clean energy, advanced technologies, fertilizers and strategic industries.
The mines ministry also said reforms in the mining auction process to shorten timelines and the introduction of the insurance surety bond as an alternative to bank guarantees have made the process easier and more flexible for bidders.
“Recent reforms, including the Mineral (Auction) Second Amendment Rules, 2025, have streamlined post-auction timelines such as submission of performance security, upfront payment and issuance of Letter of Intent. Additionally, the Mineral (Auction) Amendment Rules, 2026 have introduced the provision of Insurance Surety Bond as an alternative to bank guarantees, enhancing flexibility for bidders,” said a mines ministry statement on Sunday.
The auction will be conducted online through a transparent two-stage ascending forward auction process, wherein the successful bidder will be selected based on the highest percentage of value of mineral dispatched quoted, the ministry added.
The Centre in 2024 identified 24 minerals as critical and strategic under the Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act), including lithium, graphite, rare earth elements (REE), tungsten, vanadium, titanium and other rare metals.
The fifth and sixth tranches of this auction were initiated in 2025, with 46 critical and strategic mineral blocks already auctioned, it said.
India’s bid to mine critical and strategic minerals comes in the wake of global supply chain disruptions and geopolitical uncertainty. For instance, in April 2025, China halted exports of crucial rare earth magnets, sending manufacturers across the globe in sectors such as defence, electronics, renewable energy and automobiles, into disarray.
China controls about 60% of the world’s rare earth mining, and about 90% of the world’s processing capacity.
The Centre has already floated a tender inviting global firms to set up five rare earth processing plants in the country to reduce dependence on China for magnets, as part of a ₹7,280 crore incentive package.
In the budget for FY27, finance minister Nirmala Sitharaman also announced the creation of rare earth corridors in four states—Odisha, Kerala, Andhra Pradesh, and Tamil Nadu—the country’s top four states for monazite reserves.
Monazite is one of the primary minerals from which rare earth elements are derived.
India has vast untapped geological potential and has identified resources for various critical minerals, but very few miners and processors, said a February 2026 Niti Aayog report on India’s critical mineral mining.
Noting the lack of industry participation in mining and processing minerals such as rare earth elements, nickel, and cobalt, the Niti Aayog report said: “…despite sizeable resources, these have not been converted into mineable reserves, largely due to limited domestic expertise and slow industrial uptake of critical mineral projects.”
From 2015 to 2024, 554 mineral blocks were successfully auctioned, but operationalization has since lagged, with only 66 mines reaching the production state as of 9 August 2025, the report noted. It also said that one concern in this process was that in certain cases, the winning bids exceeded 100% of the mineral’s assessed value. “Such aggressive bidding carries the risk of inflating downstream metal costs, which could impact overall sectoral competitiveness,” the report said.
