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Context:

Parliament has passed the Mines and Minerals (Development and Regulation) Amendment Bill, 2025, with the Rajya Sabha.

About the Mines and Minerals (Development and Regulation) Amendment Bill, 2025:

The Bill seeks to modernise India’s mining law to secure supplies of critical and strategic minerals, boost exploration (including overseas), and improve the commercial use of mineral resources.

Parliament cleared the bill in August 2025 amid government claims of resource security and criticism over federal, environmental, and social safeguards.

Background

The global green and digital transitions have sharply increased demand for minerals such as lithium, nickel, cobalt, and rare earths. India imports many of these inputs.

The government frames the amendment as necessary to reduce import dependence, build resilient supply chains, and attract investment into exploration and value addition.

The bill forms part of a broader National Critical Mineral Mission, which the government says will include large funds for exploration, including overseas acquisitions.

Captive vs. Non-Captive Mines

 Key features:

• Focus on critical and deep-seated minerals: The bill explicitly prioritises exploration and extraction of minerals considered strategic for industry and national security.
• Funding for overseas exploration/acquisition: The government has allocated about ₹32,000 crore under the mission to secure mineral assets and exploration abroad.
• Relaxation for captive miners and sale rules: The amendment removes the earlier statutory cap on sale from captive mines and expands the scope for leasing and sale of mineral dumps, intending to improve commercial viability.
• Modernisation measures: Provisions aim to simplify lease operations, encourage private exploration, and enable mineral exchanges and market mechanisms.
• Environmental and conservation language: The bill includes clauses on mineral conservation and zero-waste management, while proposing procedural changes to speed up exploration clearances.

What does the government argue?

The government’s argument is straightforward: critical minerals are central to electric vehicles, batteries, renewable energy, and defence. Domestic exploration and overseas acquisitions can secure long-term supply, reduce import bills, create jobs, and encourage allied industries. Reforming old statutory limits (1957 Act) is presented as a way to attract investment and modernise the sector.

Constitutional and federal issues

Mining is a state subject under the Constitution, and several provisions of the bill expand central direction or create national mission mechanisms that affect states’ roles.

State governments and some regional MPs raised concerns in Parliament about centre-state balance, royalty and revenue sharing, and the right of states to regulate minerals within their territory. Any lasting solution must respect federal fiscal space and involve states in implementation.

Environmental and social implications

Mining has long-standing environmental costs — land disturbance, water stress, biodiversity loss, and community displacement. While the bill references mineral conservation and zero-waste ideas, critics warn that easing norms to accelerate critical-mineral production can risk ecological safeguards and community rights (including under forest and land laws) if not strictly enforced.

Strong environmental impact assessment, local consent, rehabilitation, and benefit-sharing are necessary to prevent conflict and injustice.

Economic and industrial impact

If implemented well, the reforms could: reduce import dependence for key inputs, attract technology and capital for deep-seated mineral extraction, enable mineral trading and value addition, and support the green economy. However, the benefits depend on transparent auctions, accountable use of public funds (including overseas investment), and ensuring mining revenues reach local communities and states.

Strategic and geopolitical angle

Securing minerals abroad (reports mention interest in countries like Zambia, Argentina, and Australia) is a clear geopolitical step, similar to how nations secure energy assets.

Overseas stakes can protect supply chains but also expose India to diplomatic risk and governance challenges in host countries. Careful diplomacy, commercial prudence, and compliance with international norms will be essential.

Implementation challenges

Key challenges include: capacity for large-scale geological exploration, creating transparent market structures, coordinating centre-state actions, environmental clearance bottlenecks, and ensuring local consent and rehabilitation.

Financing overseas purchases raises questions of public accountability and commercial due diligence. The success of the bill will rely more on institutional capacity and implementation than on the law alone.

Recommendations

• Centre-state consultation: Set up a joint monitoring body with state representation for project approvals, revenue sharing, and community welfare.
• Strong environmental safeguards: Make EIA and consent non-negotiable for critical-mineral projects; create fast-track but rigorous assessment lanes.
• Transparent overseas investments: Public disclosure of investments, due diligence reports, and parliamentary oversight for large acquisitions.
• Local benefit-sharing: Mandatory community development funds and employment tie-ups in mining districts.
• Build exploration capacity: Invest in domestic geological surveys, technology for deep-seated exploration, and public-private partnerships.

READ ABOUT Council on Energy, Environment and Water recommendations- Council on Energy, Environment and Water (CEEW)

Conclusion

The Mines and Minerals Amendment Bill, 2025, is an important policy step to secure minerals vital for India’s economic and green transition. Its promise will be fulfilled only if reforms are implemented transparently, with strong environmental safeguards, genuine federal consultation, and clear mechanisms to protect local communities and public money.

Source: DOWN TO EARTH