·PIB·15 marks·250–350 words

Examine how successive amendments to the MMDR Act, 1957 (2023, 2025, 2026) have reshaped India's mineral governance and critical mineral security.

In this answer
  1. Reshaping mineral governance
  2. Strengthening critical mineral security
  3. Concerns raised

The Mines and Minerals (Development and Regulation) Act, 1957 vests the Union with control over regulation of mines and mineral development. Three amendments in quick succession — 2023, 2025 and 2026 — have progressively deepened central control while orienting the sector towards critical mineral self-reliance.

Reshaping mineral governance

  • 2023: introduced auction as the exclusive mode of allotment for notified minerals and created an exploration licence, auctioned through reverse bidding on the share of auction premium, for deep-seated and critical minerals listed in a new Seventh Schedule [1].
  • 2025: carried forward reforms including royalty rates and institutional strengthening for critical minerals [2].
  • 2026: extends Union regulation from "mines" to mineral-bearing lands, identified by parameters prescribed by the Centre [3].
  • Fiscal centralisation: the 2026 Bill bars States from levying any tax, cess or levy on mineral rights or mineral-bearing land, permitting such levies only as the Centre prescribes [3][4].

Strengthening critical mineral security

  • Exploration licences allow private explorers to prospect for cobalt, lithium, graphite and rare earths, with explored blocks directly auctioned as mining leases — improving both State revenue and exploration depth [1].
  • Cabinet-approved royalty rates for 12 critical and strategic minerals (Beryllium, Cobalt, Gallium, Tantalum, Tungsten, Vanadium etc.) removed pricing uncertainty for bidders [5].
  • Auction premium exemption for blocks with low critical-mineral value has been used to make such blocks commercially viable [6].

Concerns raised

  • The 2026 restriction effectively narrows the 2024 Supreme Court ruling (Mineral Area Development Authority case) that States may tax mineral rights under Entries 49 and 50, State List — raising questions of legislative competence and retrospectivity, since pre-Act unpaid dues are deemed invalid while collected amounts are not refunded [4].

Together, these amendments mark a decisive shift from a permission-based, State-revenue-centric regime to an auction-driven, strategically-oriented one. Sustaining it will require cooperative federalism — compensating resource-rich States through predictable royalty and District Mineral Foundation flows — so that mineral security and fiscal federalism advance together rather than at each other's cost.

Sources

  1. 1Parliament Passes Mines and Minerals (Development & Regulation) Amendment Bill, 2023 — PIBauction exclusivity, exploration licence, reverse bidding, Seventh Schedule
  2. 2MMDR Amendment Act, 2025 — PIB2025 reforms on royalty and critical minerals
  3. 3MMDR Amendment Bill, 2026 — PIB Factsheetregulation of mineral-bearing lands; bar on State levies
  4. 4The Mines and Minerals (Development and Regulation) Amendment Bill, 2026 — PRS India2024 Supreme Court ruling, Entry 49/50 competence and retrospectivity concerns
  5. 5Cabinet approves royalty rates for 12 critical and strategic minerals — PIBroyalty rates for Beryllium, Cobalt, Gallium, Tantalum, Tungsten, Vanadium etc.
  6. 6Auction for Critical Mineral Blocks — PIBauction premium exemption for critical mineral blocks