The government has introduced the Mines and Minerals (Development and Regulation) Amendment Bill, 2026 in the Lok Sabha, proposing several changes to India’s mining framework. The Bill seeks to give mining leaseholders greater flexibility, support exploration of critical and strategic minerals and expand opportunities for the development and trading of mineral resources.
The proposed legislation seeks to amend the Mines and Minerals (Development and Regulation) Act, 1957. It focuses particularly on mineral exploration and development, with provisions aimed at critical and strategic minerals. The changes also seek to provide greater flexibility to mining leaseholders in managing and developing mineral resources.
Mining leases could cover additional minerals
Under the proposed amendments, a holder of a mining lease for a particular mineral can apply to the state government to include other minerals in the same lease. This could allow leaseholders to explore and develop additional mineral resources within existing mining areas.
For critical and strategic minerals and other specified minerals, including lithium, graphite, nickel, cobalt, gold and silver, the leaseholder will not have to pay an additional amount for their inclusion. For other minerals, the leaseholder will need to pay an amount equivalent to the applicable royalty.
For auctioned mines, the leaseholder will also have to pay the auction premium applicable to the additional mineral. The central government can modify these payment requirements through a notification.
The Bill also proposes allowing minor minerals to be included in mining leases granted for major minerals. The state government will determine the applicable royalty and other payments in such cases. Minor minerals include building stones, gravel, sand and other minerals that the Centre has classified as minor minerals.
The government will prescribe conditions for including major minerals in minor mineral leases through Rules. However, the proposal does not allow an atomic mineral above a specified grade to be included in a mining lease granted for non-atomic minerals.
Mineral exploration fund gets wider role
The Bill proposes expanding the role of the National Mineral Exploration Trust. At present, the Trust primarily supports mineral exploration. Under the proposed changes, it will also finance the development of mines and minerals.
The government also proposes renaming the body as the National Mineral Exploration and Development Trust. The expanded mandate is intended to support mineral development alongside exploration.
Captive mines could sell more minerals
Another major proposal concerns the sale of minerals produced from captive mines. At present, captive mine operators can sell up to 50 per cent of the minerals produced in a year after meeting their end-use requirements.
The proposed amendment seeks to remove this 50 per cent ceiling. This would give captive mine operators greater flexibility in selling mineral output after meeting the requirements linked to their approved end use.
The Bill also gives state governments the power to permit the sale of mineral dumps stored within a leased area up to a date specified by the central government.
Changes proposed for deep-seated minerals
The proposed legislation also includes provisions for deep-seated minerals, which occur more than 200 metres below the land surface.
For such minerals, the Bill proposes a one-time extension of the area covered under a mining or composite lease. A composite licence could receive an extension of up to 30 per cent of its existing area, while a mining lease could receive an extension of up to 10 per cent.
A composite licence provides rights for both prospecting and mining.
New framework for mineral exchanges
The Bill also proposes establishing an authority to register and regulate mineral exchanges. The legislation defines a mineral exchange as a registered electronic trading platform or marketplace for trading minerals and metals.
The central government will frame Rules governing these exchanges. The proposed framework will cover registration, fees and charges, prevention of insider trading and market manipulation, as well as mechanisms for resolving grievances.
The proposed changes are aimed at expanding India’s mineral resource base and encouraging greater exploration and development. The government also seeks to strengthen the availability of critical minerals and provide greater flexibility in the use, sale and trading of mineral resources.
With critical minerals becoming increasingly important for sectors such as clean energy, advanced manufacturing and technology, the proposed MMDR changes could provide a wider framework for mineral exploration, mining and resource development in India.
