The Mines and Minerals (Development and Regulation) Amendment Bill, 2025 was introduced in the Lok Sabha on August 11, 2025, and passed on August 12, 2025. On August 19, 2025, it was passed in the Rajya Sabha. This bill received the presidential assent on August 21, 2025 and became an act, whereas its provisions came into force on September 1, 2025.
The aim of the legislation is to liberalise and make advancement in the mining sector of India. As a revolutionary reform, the act focuses on making India self-reliant in mineral production. It seeks to amend the foundational Mines and Minerals (Development and Regulation) Act, 1957.
Objectives of the Amendment Act, 2025
The act was framed keeping in view the following objectives:
- To revise the provisions of the MMDR Act, 1957
- To liberalise and boost the mining sector of India
- To enhance the production of critical minerals
- To reduce the reliance of the country on imports of minerals and metals
- To use critical minerals for trading purposes and enhancing market efficiency
- To promote mineral exploration and development both within India (including offshore) and outside India
- To improvise the governance of the mining sector of India
- To modernise the regulatory mechanism used in India’s mining sector and to make it transparent
- To facilitate the National Critical Mineral Mission (NCMM) through a legal framework supporting sustainable and zero-waste mining
What are Critical Minerals?
Critical minerals are those minerals that are necessary for the economic growth and national security of the country. If there is a lack of these minerals, or if they are limited to certain geographical locations, it can hamper the supply chain.
These minerals are significant in clean energy technologies like electric mobility, renewable energy, and advanced technologies. They are used in almost every sector, including agriculture, sports, solar panels, wind turbines, medical equipment, electricity, cell phones, defence, electronic, aircraft, etc.
However, these critical minerals are produced in a limited quantity in India, thereby forcing us to rely heavily on imports—for example, almost entirely for lithium and nickel, and nearly 93 per cent for copper. There are 30 critical minerals recognised by our country. Out of these, 24 are mentioned in Part D of Schedule I of MMDR Act, 1957, authorising the central government to auction mining lease and composite licences for these minerals.
About NCMM
NCMM stands for National Critical Mineral Mission. This mission was launched by the Government of India in 2025 with an aim to make India self-reliant in the critical mineral sector. The mission also secures the long-term availability and processing of these minerals. The MMDR Amendment Act, 2025 provides the legal backing to the mission, enabling funding through the National Mineral Exploration and Development Trust (NMEDT).
Under the earlier system, NMEDT had approximately Rs 3,500 crore corpus. With lessee contribution now raised from 2 to 3 per cent of royalty, the trust is expected to mobilise an additional Rs 2,500 crore over five years and around Rs 8,700 crore will be spent over the next five years to support NCMM initiatives.
Key Provisions of the Act
The key provisions of the Mines and Minerals (Development and Regulation) Amendment Act, 2025 are mentioned below:
- Streamlining of Mining Laws and Regulation: The act mandates the streamlining and simplification of mining laws and regulations to attract more investment in the mining sector. Consequently, the mineral resource allocation will become more transparent and effective. Also, in section 10B of the principal act, the words ‘after obtaining the previous approval of the central government’ are omitted to simplify the procedure.
- Modernised Monitoring System: The monitoring in the mining sector will be modernised by using advanced technological tools and digital processes. It can further be made efficient by using easy-to-use licensing processes to reduce bureaucratic delays.
- Framing of Policies: The act states that the framing of policies should be in line with industrial progress and energy requirements of the country.
- Inclusion of Minerals in Existing Leases (Section 15B): Critical and strategic minerals such as lithium, cobalt, silver, nickel, and gold (listed in Part D of Schedule I and Schedule VII) can be included in the existing leases of mining leaseholders, and for this, they are not required to pay any additional royalties. With this liberty, miners can extract more minerals on a large scale that can be used in different fields like agriculture, aerospace, space technology, and electronics. However, in case of other minerals, the leaseholders are supposed to pay royalties as well as auction premiums (as prescribed in the eighth schedule) which can be modified by the central government through notification. When minor minerals are included in leases granted for major minerals, the royalty will be determined by the respective state government. However, atomic minerals of certain grades cannot be included in leases granted for non-atomic minerals.
[There are 24 critical and strategic minerals listed in Part-D of Schedule I of the MMDR Act.] - Scope of National Mineral Exploration Trust: The National Mineral Exploration Trust has been renamed as the National Mineral Exploration and Development Trust (NMEDT). The act has expanded the scope of the trust, which can now be used for funding not only exploration of mines but also development of mines. The funds will be used for activities carried out within the country, including offshore regions as well as in the regions outside the country. Thus, international exploration projects are also funded by the trust to secure supply chains.
- Sale from Captive Mines and Mineral Dumps: According to the MMDR Act 1957, only up to 50 per cent of the minerals (i.e., the remaining minerals after meeting internal needs) could be sold off by captive mines. The amendment removes this restriction. It permits the captive mines to sell off the entire output of such minerals in the market.
Further, the state governments are authorised to allow all kinds of mineral dumps to be sold, lying within leased areas. This will ensure better resource utilisation. - Extension of Mining Lease Areas: Under a mining lease or composite licence, the area can be extended one-time, which can include an adjacent area only up to 10 per cent or 30 per cent, respectively, of the present area. This provision applies only to deep-seated minerals that are occurring below 200 metres with poor surface manifestations. The Centre may also prescribe some additional payment for such extensions. This provision prevents uneconomic parallel leasing and ensures optimal extraction.
- Establishment of Mineral Exchanges: The act provides for the creation of mineral exchanges. Mineral exchanges refer to the electronic platforms through which minerals concentrate, and processed forms (including metals) will be traded. The central government is empowered to oversee and regulate these exchanges. Rules regarding registration and reputation of exchanges, transaction procedures, fees, grievance redressal, and prevention of cartelisation and market manipulation will be framed by the Centre only. This will ensure transparency and efficiency in mineral trade market.
Expected Impact of the Act on the Mining Sector
The implementation of the Mines and Minerals (Development and Regulation) Amendment Act, 2025 can have the following expected impacts:
- With the implementation of the act, the revenues of the state government may considerably increase via auction and royalty.
- There will be more mining activities, which may create more job opportunities in regions rich in mineral resources.
- More private and foreign investment may be made due to simplified business procedures.
- India will become self-reliant in critical minerals necessary for various sectors due to increased mineral production.
- Advanced monitoring mechanisms may reduce the level of corruption.
- The NCMM will have increased operational efficiency.
- The emphasis on zero-waste mining, efficient use of mineral dumps, and deep-seated mineral development will ensure resource conservation.
Conclusion
The growth and development of India are closely linked to the mining sector. The MMDR Act, 2025 serves as a revolutionary step in transforming the sector. It integrates advanced technology in the mining sector, which will provide economic growth and better governance through sustainable means. It aligns with the government’s developmental goals and positions. India is on the global platform for exploring and developing critical minerals important for various industries.
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