The cabinet is likely to consider amendments to Mines and Minerals (Development and Regulation) Act on Wednesday. Under the Atmanirbhar Bharat announcement, the government proposed to auction over 500 mineral mines for which it proposed changes to the MMDR Act to bring in the reform for the mining sector. It is expected that these reforms will pave way for higher production of minerals to reduce import dependence and generate employment.

Most of the changes proposed for the MMDR Bill 2021 were cleared by the cabinet in January but the Ministry of mines again proposed supplementary provisions to the MMDR bill in February. The draft bill proposes to allow the sale of 50 percent coal produced from captive mines which were allotted prior to commercial coal mining auction. The idea is to maximize the utilization of coal as the global energy transition is happening faster than expected. Also, the Government has not seen as much enthusiasm for commercial coal auction after 2015 auctions post deallocation of coal blocks by the Supreme Court on account of irregularities in allocation.

In order to encourage higher production of minerals, provisions have been also been to allow captive miners to sell up to 50 percent of excavation in a year. The captive miners will have to pay additional royalty to the states for minerals like bauxite, iron ore, chromite, limestone, and manganese.

The proposal also included the fixation of the additional amounts for granting an extension of existing mining leases of the government companies to reduce delay in mining operations. In the past, NMDC’s Donimalai iron ore mines in Karnataka were shut for a long time on account of expiry and the central government had to step in and talk with the state government to allow operations after increasing royalty from the company. 1.5 times the existing royalty will be levied in case a government company’s expired mining lease is renewed in case of iron ore and an equivalent amount for other minerals.

The central government has also proposed to allow itself to conduct auctions of mineral mines in case of difficulties faced by the state governments.

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(Edited by : Ajay Vaishnav)

First Published:Mar 10, 2021 10:08 AM IST