Lok Sabha Question No. 2006 (UNSTARRED), answered on 2026-02-11
Subject: Outcomes of MMDR Amendment Act, 2025
Ministry: MINES
Asked by: Smt. Sangeeta Kumari Singh Deo

## GOVERNMENT OF INDIA MINISTRY OF MINES

## LOK SABHA UNSTARRED QUESTION NO. 2006

ANSWERED ON 11.02.2026

## OUTCOMES OF MMDR AMENDMENT ACT, 2025

2006. SMT. SANGEETA KUMARI SINGH DEO:

Will the Minister of MINES be pleased to state:

- (a) the extent to which the amendments introduced through the MMDR Amendment Act,  2025  have  translated  into  faster  mine  operationalisation,  increased  mineral production  and  improved  investment  response  during  2025  and  if  so,  the  details thereof;
- (b)  the  details  of  the  utilisation  of  funds  mobilised  under  the  National  Mineral Exploration  and  Development  Trust  (NMEDT)  including  domestic,  offshore  and overseas exploration activities initiated after its expansion;
- (c) the details of impact of streamlined auction timelines, penalty-incentive mechanisms,  removal  of  captive  mine  sale  restrictions  on  auction  success  rates, production timelines and State revenues; and
- (d) the progress made in operationalising mineral exchanges, offshore mining reforms and  their  role  in  ensuring  transparent  pricing,  mineral  security  and  supply-chain resilience, particularly for critical and strategic minerals?

## ANSWER

## THE MINISTER OF COAL AND MINES (SHRI G. KISHAN REDDY)

(a) & (b): The Mines and Minerals (Development and Regulation), Act, 1957 (MMDR Act)  was  amended  through  the  MMDR  Amendment  Act,  2025  with  effect  from 01.09.2025. Through the said amendment, inclusion of any new mineral in the mining lease has been allowed subject to payment of additional amount specified in the Eighth Schedule to the MMDR Act. Further, State Governments have been allowed to grant one-time extension of the area under a mining lease (up to 10 percent of existing leased area) or  composite  licence  (up  to  30  percent  of  existing  licenced  area)  on payment  of  additional  amount  prescribed  by  the  Central  Government.  These amendments  facilitate  faster  mine  operationalization  and  increased  production  of minerals in the country.

The  Central  Government  has  notified  the National Mineral Exploration Trust (Amendment) Rules, 2025 on 23.10.2025 to implement the provisions of the MMDR

Amendment Act, 2025. Accordingly, the object of the Trust shall be to use the funds accrued to the Trust within India, including the offshore areas, and outside India for the  purposes  of  regional  and  detailed  exploration  and  development  of  mines  and minerals. As on 31.01.2026, 656 projects have been approved under the National Mineral Exploration and Development Trust with an approved project cost of Rs. 3,426 crores, out of which Rs. 1,518 crores have been utilized.

(c): Ministry of Mines has amended the Mineral (Auction) Rules, 2015 with effect from 17.10.2025 whereby intermediary timelines have been introduced in the Rules in order to fast-track the operationalization of auctioned mineral blocks.

The  Rules  provide  for  appropriation  of  1%  of  the  performance  security  for  delay (attributable  to  the  bidder)  of  each  month  or  a  part  of  month  beyond  the  above timelines. The Rules also provide for adjustment of the appropriated amount, if any, against  the  auction  premium  payable,  if  the  final  milestone  is  achieved  within  the stipulated  overall  timeframe.  Further,  the  Rules  also  provide  for  reduction  in  the amount of second installment of the upfront payment by 5% for the delay of each month or a part of month by the State Government in issuing the letter of intent to the preferred bidder beyond the stipulated time.

Further, an incentive has been provided for early commencement of production from the auctioned mines. The lessee is required to pay only 50 percent of the auction premium for the mineral produced, within five years from the date of issue of letter of intent for grant of mining lease or within seven years from the date of issue of letter of intent for grant of composite licence.

Through  the  MMDR  Amendment  Act,  2021,  the  end-use  restrictions  have  been removed from auction of mines. Since the said amendment, 496 mineral blocks have been successfully auctioned taking the total number of successfully auctioned mineral blocks  to  612.  Revenue  accruing  to  States  has  increased  significantly  after  the introduction of auction regime.

(d): Through the MMDR Amendment Act, 2025, the Central Government has been empowered  to  promote  development  of  market,  including  trading,  of  minerals,  its concentrate  or  its  processed  forms  (including  metals)  through  mineral  exchanges. These exchanges help in determining fair and transparent market prices based on supply and demand dynamics, stabilize markets and aid in budgeting and planning. The reform is applicable for all minerals including critical and strategic minerals.

Further, the Offshore Area Mineral (Development and Regulation) Act, 2002 (OAMDR Act,  2002)  has  been  amended  through  the  OAMDR  (Amendment) Act, 2023,  with effect  from  17.08.2023  to  mandate  auction  as  the  methodology  for  the  grant  of operating  rights  to  private  companies,  thereby  ensuring  a  fair  and  transparent mechanism of allocating operating rights in the offshore areas of the country. The

Central  Government has notified the Offshore Areas Mineral (Prevention of Illegal Mining and Transportation) Rules, 2026 on 03.02.2026.

Moreover, the Central Government has set up National Critical Minerals Mission on 29.01.2025 with the aim to secure India's critical mineral supply chain by strengthening complete value chain, including mineral exploration and mining.

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