Par passes Mines Amendment Bill 2025 to boost critical minerals production, attract investments

New Delhi, Aug 19 (PTI) Parliament on Tuesday passed the Mines and Minerals (Development and Regulation) Amendment Bill, 2025, aimed at further liberalising and modernising India's mineral sector with a particular focus on critical and strategic minerals essential for the country's green energy transition.

The legislation, which amends the original Mines and Minerals (Development and Regulation) Act, 1957, and was earlier passed by the Lok Sabha on August 12, received approval from the Rajya Sabha through a voice vote.

Around 19 members participated in the debate. However, Opposition MPs staged a walkout from the House.

Responding to the debate, Union Minister of Coal and Mines G Kishan Reddy highlighted the Modi government's transformative initiatives in the coal and mining sector over the past decade.

"The current government has brought revolutionary reforms, introducing transparency and accountability that has significantly boosted production of coal and minerals," Reddy said.

The minister emphasised the growing importance of critical minerals, noting that the government has identified 24 critical and strategic minerals and launched the National Critical Mineral Mission (NCMM) with an outlay of Rs 34,000 crore to increase domestic production, including from offshore areas.

"India is a big market. From cell phones to airplanes, laptops to space technology, and even in the agriculture sector, critical minerals are required. There is huge demand. Our challenge is to increase production," Reddy explained.

The amendment bill introduces several significant changes to modernise the mining framework: Mining leaseholders can now add new minerals, especially critical ones like lithium, cobalt, and nickel, to their existing operations without paying additional royalty.

The National Mineral Exploration Trust has been renamed as the National Mineral Exploration and Development Trust, with its scope widened to fund not only exploration but also development of mines and minerals, including in offshore areas and internationally. Contributions from lessees to the trust will increase from 2 per cent to 3 per cent of royalty.

The bill permits one-time extension of mining areas for deep-seated minerals and removes the 50 per cent sales cap on minerals from captive mines. States are also empowered to allow sales of mineral dumps.

The legislation establishes regulated mineral exchanges for transparent trading and streamlines licensing procedures to attract investments and enhance transparency.

With limited domestic reserves, India currently depends heavily on imports for critical minerals. The minister outlined the government's multi-pronged strategy to secure mineral supplies.

India is actively securing supplies from countries including Zambia, Argentina, and Australia. The country has formed a public sector undertaking to source minerals from five blocks in Argentina, where lithium exploration has commenced and is expected to complete next year.

Thirteen offshore blocks have been identified for exploration, with private sector participation being actively promoted. The prime minister's recent five-country visit included discussions on securing critical minerals to meet India's rising demand.

The Geological Survey of India (GSI), which completed 175 years this year, will establish a separate division focusing on critical mineral exploration.

The minister highlighted remarkable growth in mineral production under the current government. Coal production crossed the 1 billion tonne milestone this year for the first time, with record coal dispatch contributing to increased consumption while reducing imports by 8 per cent, saving approximately USD 8 million in foreign exchange.

Iron ore production has nearly doubled from 152 million tonnes in 2014 to 289 million tonnes currently, while limestone, bauxite, and aluminium output have also registered significant increases.

Looking ahead to 2030, Reddy projected substantial increases in mineral demand: iron ore requirement is expected to reach 450 million tonnes, limestone 720 million tonnes, bauxite 37 million tonnes, and coal 1,522 million tonnes.

The minister mentioned prior to 2014, the sector was hit by "corruption with a Rs 1.86 lakh crore scam". There was total "administrative paralysis" with "fearful atmosphere and favouritism in allotment of license", he said and added "this was changed by the current government". PTI LUX CS HVA