All Ore, No Door:
Why India's Future may be Made in China

Until 2015, India handed out mineral rights largely on a first-come basis. Since then, by auction.

In 2023 the Centre took the power to auction critical mineralsiMinerals an economy cannot easily do without and whose supply could be cut off, because it comes from a few countries. India's list has 30. sites, while the states still grant the leaseiThe legal right to mine a block for a fixed period. and keep the money.

The auction works like leasing out a field for a share of the crop. Companies bid the percentage of the value of every tonne sold that they will pay the state, on top of the royaltyiA fixed charge a miner pays the state on every tonne it sells.. Highest bid wins.

Once the winner is named, the Ministry's own deadlines allow 30 days for a letter of intentiThe state's written promise to grant the lease to the winning bidder, once conditions are met., six months for a mining plan, 18 months for environmental clearanceiCentral approval that a project's impact on air, water and land is acceptable. and 12 months to sign the lease. That is about 37 months, before forest clearanceiSeparate approval needed when a block sits on forest land., which has no published clock at all.

Take Hindustan Zinc. It won the Jhandawali-Satipura block in May 2025. In April 2026 it was still waiting for its license deed.

Then a second clock starts. No production within two years of signing, and the lease can lapse.

So how many projects actually make it through the door?

Start with the entry test. An auction goes ahead at the first attempt only if at least three technically qualified biddersiCompanies that pass the eligibility checks (Indian registration, minimum net worth) and may bid. turn up. Of the 81 auction offers made in the first five rounds, from November 2023 to May 2025, 34 cleared that bar.

Why stay away?

Bidders price what they cannot see. By November 2024, 49 different blocks were offered. About 90% of those 49 blocks had no clearly defined resource, and only about one in ten mining blocks had been surveyed well enough to mine.

It is like bidding for a house after seeing only the gate.

Then there is the clock. Worldwide, a mine takes about 16-18 years to go from discovery to output. India's quoted figure, 14 to 15 years, sits around that band.

Speed is not where India stands out then, we take roughly the same amount of time to go from discovery to first output. Conversion is.

Of the 132 commercial coal blocks allocated since 2020, 15 are producing. 11.4%. Across all minerals, estimates of blocks actually operating run at roughly one in seven.

Now the credit, because it is due. Since 2023 the rules have been loosened in the bidder's favour at least seven times: lower deposit caps, a second attempt with a single bidder, no premiumiThe share of sale value a winner pays the state on top of royalty. It is what the auction bids on. on minor by-product minerals, faster refunds, a shorter window to sign a lease.

In October 2025 the Ministry proposed cutting the minimum to two bidders.

Every country with ore in the ground has faced the same question.

Some forced the issue. Indonesia banned exports of raw nickel ore in 2020. It now produces more than half the world's nickel. The catch: Chinese firms hold about 90% of the processing capacity, and about 90% of the value added does not stay in Indonesia.

Saudi Arabia is the closest match to what India is attempting. It auctions exploration sites, but only after the state has paid for the early survey work. In India, about one in ten mining blocks reached auction with that work done.

Here's where it gets interesting.

In investable terms, critical minerals are not one business. They are at least five.

The market is paying most for the layer where the critical-mineral content is least direct. A forging maker earns mostly from cars and defence, not rare earths. Hindustan Copper is the one miner priced like a maker.

And the middle has no listed pure playiA listed company that earns mainly from one business, so its share price tracks that business.. That is also where India's biggest gap sits.

The magnet scheme (Rs 7,280 crore for 6,000 tonnes of magnets a year) intented to fix this needs roughly 2,000 tonnes of rare earth oxideiRare earth in purified powder form, the input a magnet maker buys. a year. Indian Rare Earths Limited (IREL)iThe state company that alone may process India's main rare earth ore, monazite. can make only about 400.

Where does the rest come from? Abroad? So does it really solve the issue?

In April 2025 China began requiring export licences for seven rare earths and the magnets made from them. Maruti cut its first-half e Vitara target from 26,512 cars to 8,221, though it said operations were not disrupted. Bajaj's Chetak output fell from 24,106 in May to 10,824 in July. Ola, which had stockpiled magnets, rode it out.

So, a household never meets this problem as a headline about auctions. It meets it as a waiting list, a delayed launch or a price. We are building the factories that make the magnets, and importing about three quarters of what goes into them.