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The Union government on Monday introduced the Mines and Minerals (Development and Regulation) Amendment Bill, 2025 in the Lok Sabha, with provisions aimed at boosting domestic mining output. Key changes include easier expansion into contiguous areas for deep-seated minerals and exemption from additional charges for critical and strategic minerals when found within an existing lease.
Under the proposed amendments, holders of mining leases for deep-seated minerals will be allowed a one-time expansion of their lease area by up to 10 per cent to cover contiguous zones that would otherwise be uneconomical to mine separately. For composite licence holders, this limit has been relaxed to 30 per cent. Deep-seated minerals occur at depths greater than 200 metres from the surface.
“These are significant provisions that would create huge benefits for the mining industry, particularly for deep-seated minerals. Companies like Hindustan Zinc, Hindustan Copper, and Hutti Gold Mines can benefit from the 10 per cent extension of contiguous areas under existing leases. Similarly, in the case of composite licences, the area can be extended up to 30 per cent of the granted concession area,” said B K K Bhatia, director general of the Federation of Indian Mineral Industries (FIMI).
The draft bill states that companies would have to pay for including extractable minerals in an existing mineral lease, but waives these charges entirely for critical and strategic minerals listed in Part D of the First Schedule and minerals in the Seventh Schedule. For other minerals, lessees of non-auctioned mines and certain auctioned coal and lignite mines will pay an amount equivalent to the royalty on the included mineral, in addition to existing statutory levies.
“To give impetus to the production of critical and strategic minerals, the bill says that in case of inclusion of associated critical and strategic minerals in existing leases, the companies would not have to pay an additional amount for their mining,” Bhatia said.
The draft law also proposes removing the 50 per cent cap on mineral sales from captive mines, setting up regulated mineral exchanges, and renaming and expanding the National Mineral Exploration Trust’s mandate while raising miner contributions from two to three per cent of royalty payments.
The Bill will allow captive miners to sell all surplus production after meeting the needs of their linked plants, with state governments permitted to authorise the sale of old mineral dumps. Mineral exchanges, defined as registered electronic platforms for trading minerals, concentrates, and metals, will be promoted to enable transparent price discovery and curb market manipulation.
The bill also seeks to rename the National Mineral Exploration Trust as the National Mineral Exploration and Development Trust to reflect its wider mandate of financing projects within and outside India, including offshore areas. The higher levy on miners is expected to add about Rs 2,500 crore to its corpus over five years, with Rs 8,700 crore in planned expenditure under the National Critical Mineral Mission.
The Ministry of Mines said the amendments aim to attract investment, optimise resource use, and ensure stable supply chains for key minerals, contributing to the country’s economic growth.
