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Parliament Clears Mines and Minerals (Development and Regulation) (Amendment) Bill, 2015
Mar 24, 2015

Parliament has passed the Mines and Minerals (Development and Regulation) (Amendment) Bill, 2015.  This Bill amends certain provisions of the MMDR Act, 1957. The Amendment Bill, 2015, became necessary to address the emergent problems in the mining industry. 

In the last few years, the number of new Mining Leases granted in the country has fallen substantially. In addition, second and subsequent renewals have also been affected by certain Supreme Court judgements. As a result, the output in the mining sector has come down drastically, leading to import of minerals by users of those minerals. 

Main Objectives of the Bill

Removal of Discretion: The Amendment removes discretion in the grant of mineral concessions. All mineral concessions are granted by the respective State Governments. They will continue to do so but all grants of mineral concessions would be through auctions, thereby bringing in greater transparency and removing discretion. 

Impetus to the Mining Sector: Continued operations in the mining industry have been affected due to the pendency of applications for second and subsequent renewals.  In fact, this pendency has led to closure of large number of mines. The Amendment Bill, 2015 addresses this issue also. 

Safeguarding Interests of Affected Persons: The Amendment Bill makes it mandatory to establish a District Mineral Foundation (DMF) in all districts where mining takes place. This is designed to address a long time grievance of civil society that people affected by mining are not cared for.   

Encouraging Exploration and Investment:  The Amendment Bill proposes to setup a National Mineral Exploration Trust created out of contribution from the mining lease holders. This would allow the Government to have a dedicated fund for undertaking exploration.

Stringent Provisions against Illegal Mining: All offences under the Act will now be subject to a maximum punishment of 5 years imprisonment or fine of Rs. 5 lakhs per hectare.  State Governments are also empowered to set up Special Courts for speedy trial of offences under the Act. 

Salient Provisions of the Bill

  • All mineral concessions will be granted only through auction.

  • Direct auction for mining leases for bulk minerals; auction of prospecting licences-cum-mining leases for deep-seated minerals.

  • Uniform lease period of 50 years; no renewals; auction at the end of lease period; will solve problems arising out of SC judgments on second and subsequent renewals.

  • Transition period of minimum 15 years for captive mines and 5 years for other mines; no sudden stoppage as a result of the Amendment.

  • All pending applications at State level (over 60 thousand) will abate except in a few cases where action is in progress/vested right exists.

  • Central Government empowered to prescribe deadlines for various processes and to issue binding directions to States.

  • Central Government to frame separate rules for atomic minerals.

  • The previous approval of the Central Government will not be required for grant of mineral concession except for Atomic Minerals.

  • Enabling powers for reservation for the public sector to continue.

  • Higher penalties and jail terms for offences; special courts may be constituted, if necessary. 

  • District Mineral Foundation to take care of people and areas affected by mining.

  • National Mineral Exploration Trust to be set up for impetus to exploration.

  • Easy transferability of concessions obtained through auctions so as to attract private investment and FDI. 

  • Powers to Central Government to intervene even where State Governments do not pass orders within prescribed time lines; this will eliminate delay. 

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