Mines and Minerals (Development and Regulation) Amendment Bill 2025
The Mines and Minerals (Development and Regulation) Amendment Bill, 2025 is one of the most significant legislative reforms introduced by the Indian government to boost the mining sector and strengthen India’s position in the global mineral market. Passed by the Lok Sabha on 12 August 2025 and cleared by the Rajya Sabha on 19 August 2025, the Bill introduces a series of amendments to the Mines and Minerals (Development and Regulation) Act, 1957.
This new legislation focuses on promoting transparency, increasing production, and facilitating trade in critical and strategic minerals — resources essential for technology, energy, defence, aerospace, and manufacturing.
In this detailed article, we will explain the key features, objectives, provisions, and impacts of the Mines and Minerals Amendment Bill 2025 in simple, easy-to-understand language.
1. Background of the Mines and Minerals Act
The original Mines and Minerals (Development and Regulation) Act, 1957 was enacted to regulate the mining sector in India. Over the years, India’s growing demand for minerals, combined with global technological advancements, required significant reforms in mining policies.
While earlier amendments focused on royalties, licensing processes, and production caps, the 2025 Bill goes a step further by addressing modern challenges like critical mineral exploration, deep-seated mining, and creating transparent trade mechanisms.
2. Objectives of the Amendment Bill 2025
The government introduced this Bill with the goal of transforming India’s mining sector into a more efficient, transparent, and globally competitive industry. The key objectives are:
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To boost mineral production and reduce India’s dependency on imports.
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To promote exploration and development of critical and strategic minerals like lithium, cobalt, nickel, and rare earth elements.
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To enable better resource utilisation through technological and policy reforms.
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To encourage private sector participation and foreign investments in mining.
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To strengthen India’s role in global supply chains for high-demand minerals used in electronics, electric vehicles, aerospace, and renewable energy.
3. Recent Legislative Developments
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The Lok Sabha passed the Bill on 12 August 2025.
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The Rajya Sabha approved it on 19 August 2025.
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The passage of the Bill was not without controversy — the Opposition staged a walkout in the Rajya Sabha, raising concerns about the environmental and local impacts of increased mining.
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The government, however, defended the Bill, calling it a “revolutionary step” towards economic growth, self-reliance, and mineral security.
4. Key Provisions of the Mines and Minerals Amendment Bill 2025
The Bill introduces several important reforms that will impact mining companies, state governments, and the overall economy. Let’s break them down one by one:
A. Inclusion of Critical and Strategic Minerals
One of the most significant provisions of the Bill is the integration of rare and critical minerals into India’s mining policies.
What’s New:
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Mining leaseholders can now add minerals like lithium, cobalt, nickel, gold, and silver to their existing mining leases without paying extra royalties.
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For other minerals, existing royalty payments and auction premiums will continue.
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The goal is to speed up extraction of minerals that are vital for electronics, aerospace, agriculture, defence, and space technology.
Why It Matters:
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Lithium and cobalt are key components in electric vehicle (EV) batteries and renewable energy storage.
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Nickel and rare metals are crucial for aerospace manufacturing and electronics.
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This move supports the National Critical Minerals Mission, aligning India’s resources with its technological and industrial growth.
B. Expansion of the National Mineral Exploration Trust (NMET)
The National Mineral Exploration Trust (NMET), established earlier, has now been renamed and empowered.
Key Changes:
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NMET becomes the National Mineral Exploration and Development Trust (NMEDT).
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Its scope expands beyond exploration to funding mine development.
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Lessees’ contribution to the Trust increases from 2% to 3% of royalties.
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The Trust can now support offshore and international mineral exploration projects.
Impact:
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Encourages scientific exploration techniques for deep-seated and critical minerals.
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Expands India’s reach to global mineral reserves, ensuring long-term resource security.
C. Removal of Sale Limits for Captive Mines
Previously, mining companies with captive mines (mines dedicated to their own industrial use) were allowed to sell only up to 50% of their mineral production in the open market.
What’s New:
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The Bill removes this 50% cap, allowing unrestricted sale of minerals.
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State governments are empowered to permit sale of mineral dumps within leased areas.
Impact:
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Companies can now generate higher revenues by selling surplus minerals.
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Better utilisation of existing resources and reduced wastage.
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Increased mineral availability in the domestic market, boosting industries like steel, cement, and energy.
D. Extension of Mining Lease Areas
India has vast reserves of deep-seated minerals, but extracting them has been challenging due to regulatory limits.
New Provisions:
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The Bill allows a one-time extension of:
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Up to 30% of the leased area for composite licences.
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Up to 10% of the leased area for mining leases.
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The extension applies to minerals located below 200 metres of depth.
Benefit:
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Encourages deep mining activities for rare minerals.
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Supports the development of advanced technologies for underground exploration.
E. Introduction of Mineral Exchanges
One of the most innovative reforms introduced in the Bill is the establishment of mineral exchanges.
What Are Mineral Exchanges?
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Electronic trading platforms where minerals and metals can be bought and sold transparently.
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The central government will frame rules for:
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Registration of traders
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Fee structures
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Prevention of price manipulation
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Grievance redressal mechanisms
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Expected Benefits:
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Promotes market transparency and competitive pricing.
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Attracts domestic and international investors.
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Encourages efficient mineral trading through digital platforms.
5. Impact of the Mines and Minerals Amendment Bill 2025
The reforms introduced by the Bill are expected to transform India’s mining sector in multiple ways:
A. Economic Growth
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By liberalising trade and boosting production, the Bill supports India’s GDP growth and industrial expansion.
B. Energy Security
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Increased production of critical minerals ensures that India can meet its growing energy demands, particularly for electric vehicles and renewable energy storage.
C. Investment Opportunities
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With fewer restrictions, the sector becomes more attractive to private investors and foreign companies.
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The establishment of mineral exchanges promotes transparency, attracting global participation.
D. Technological Advancement
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Promotes cutting-edge exploration techniques and deeper mining capabilities.
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Supports India’s long-term goals in space, defence, and electronics.
E. Support for National Missions
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The Bill aligns with the National Critical Minerals Mission, which has a ₹34,000 crore budget to boost India’s capabilities in exploring and securing rare minerals.
6. Challenges and Concerns
While the Bill has many positive aspects, there are also concerns raised by environmentalists, industry experts, and opposition parties:
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Environmental Impact:
Increased mining could lead to deforestation, biodiversity loss, and soil degradation if not monitored properly. -
Local Community Rights:
Tribals and local communities living near mining areas may face displacement and livelihood issues. -
Market Volatility:
Introducing mineral exchanges could make prices unstable if regulations are not strict enough. -
Implementation Challenges:
Success depends on how effectively the central and state governments execute the reforms.
7. Government’s Defence and Vision
The government has strongly defended the Bill, calling it a “revolutionary reform”. Key highlights of its vision:
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Making India self-reliant in critical minerals.
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Reducing dependency on countries like China for rare earth elements.
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Promoting Make in India and Atmanirbhar Bharat by securing raw materials for industries.
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Boosting India’s position in global supply chains for clean energy technologies.
8. Conclusion
The Mines and Minerals (Development and Regulation) Amendment Bill, 2025 represents a major step forward for India’s mining industry. By opening up opportunities for critical mineral extraction, deep-seated exploration, transparent trade, and technological innovation, the Bill aims to make India a global leader in mineral production and trading.
However, for the Bill to succeed, the government must ensure sustainable mining practices, protect environmental resources, and safeguard the rights of local communities. If implemented effectively, these reforms could transform India into a self-reliant hub for critical and strategic minerals.
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