Amendments to Mines and Minerals (Development and Regulation) Act, 1957

The Ministry of Mines administers the Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act, 1957) which is the Central Act that governs the development and regulation of mines and minerals in terms of the powers vested in the Central Government as per Entry 54 of the Seventh Schedule of the Constitution.

The MMDR Act, 1957 has been amended from time to time to promote and conserve  the mineral resources of the country. Through the amendment in the MMDR Act in year, 2015, it has been made mandatory that the mineral concessions will be granted through transparent and non-discriminatory method of auction to ensure the fair value of mineral resources to States.

Recently, Ministry of Mines has amended MMDR Act, 1957 through the MMDR Amendment Act, 2021 which has been notified on 28.03.2021 for giving boost to mineral production, improving ease of doing business in the country and increasing mineral production. The amended Act, inter-alia, contains following provisions which promote the mineral sector in the country:

  • Simplification of exploration regime – (i) To ensure seamless transition of the concession from exploration to production (ii) Mineral Blocks for Composite Licence can be auctioned at G4 level of exploration instead of G3 level as per the earlier standard. (iii) Mineral Block for surfacial mineral can be auctioned for grant of Mining Lease at G3 level instead of G2 level. (iv) Private entities may be notified under Section 4(1) of the MMDR Act for conducting exploration.
  • National Mineral Exploration Trust shall be a non profit autonomous body; the entities notified under Section 4(1) of the MMDR Act are eligible for funding through funds accrued under NMET.

Further, Section 18 of the MMDR Act, 1957 empowers Central Government to frame rules for conservation and systematic development of minerals and for the protection of environment by preventing or controlling any pollution which may be caused by prospecting or mining operations. Accordingly, Mineral Conservation and Development Rules (MCDR), 2017 (amended from time to time) were framed. As per Section 5(2) (b) of the MMDR Act 1957, no mining lease can be granted unless there is a mining plan for the development of mineral deposits in the area concerned duly approved by the Central Government or by the State Government. Mining Plan incorporates detailed proposals for systematic and scientific mining, conservation of minerals and protection of environment with respect to the lease area. Indian Bureau of Mines IBM is mandated for approval of Mining Plan, as per the provisions of Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Rules, 2016. As per the provisions of MCDR, 2017, Indian Bureau of Mines carries out periodical inspections of mines to monitor conservation of minerals, systematic and scientific mining and protection of environment in the leasehold areas of minerals other than minor minerals, coal and atomic minerals.

Further, section 4A of MMDR Act 1957 empowers the Central Government after consultation with the State Government to terminate Prospecting Licence or Mining Lease, inter alia, for conservation of mineral resources.

The MMDR Amendment Act, 2015 ushered in transparency in the allocation of mineral concessions in terms of Prospecting License and Mining Lease. In this continuous endeavour, the Mines and Minerals (Development and Regulation) Amendment Act, has been further liberalized in March 2021. The recent amendment is expected to increase employment and investment in the mining sector, increase the revenue to the States, increase production and time bound operationalization of mines, maintain continuity in mining operations after change of lessee, increase the pace of exploration and auction of mineral resources.

With this amendment, in order to realise the vision of ‘Atma-Nirbhar Bharat’, the Geological Survey of India has delineated 100 geologically potential mineral blocks for auction. Handing over of these 100 Reports to the State Governments will ensure continuous supply of minerals in the country and more revenue to the State Governments by bringing more number of mineral blocks under auction. With time, the frequency of major discoveries of an economically viable mineral deposit has decreased and this is a worldwide phenomenon despite tremendous technological advancements. Hence, the situation warrants, out of box thinking, new approaches, enhanced cooperation and enthusiastic participation from the Government and private sectors. In the above scenario, the handing over of 100 reports by GSI to state governments attains crucial importance to the mining sector, industrial growth and employment generation.

Source: PIB

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