Lok Sabha passes Bill to amend MMDR Act

Construction Work Online | March 22, 2021

The Bill also seeks to remove the distinction between captive and merchant mines

The Lok Sabha has passed the Mines and Minerals Development (Amendment) Bill, 2021 which, among others, proposes to free up for auction 572 idle non-coal mining blocks allocated before the auction regime set in with the 2015 amendment of the MMDR Act.

“We are withdrawing that provision of 10A(2)(b) and all these 572 mines will be brought under auction. Some of them are so old,” mines minister Pralhad Joshi said introducing the Bill in Lok Sabha.

The minister said reconnaissance permit (RP) and prospecting licence (PL) given to these blocks should have been converted into mining leases in these many years but “a majority of them have neither applied for it nor the state governments have recommended them.”

These 572 leases are spread over 4.6 lakh hectare area and their minimum worth is Rs 27 lakh crore.

The Bill also seeks to remove the distinction between captive and merchant mines by providing for auction of mines in future without restriction of captive use of minerals.

It also allows existing captive mines including captive coal mines to sell up to 50% of the minerals produced after meeting the requirement of linked end use plants to ensure optimal mining of mineral resources by paying an additional amount to the states. The sale of minerals by captive plants would facilitate increase in production and supply of minerals, ensure economies of scale in mineral production, stabilise prices of ore in the market and bring additional revenue to the states.

“Around 55 lakh, direct and indirect, employment opportunities are expected to be generated through this reform,” Joshi said.

The Bill also empowers the central government to issue directions regarding composition and utilisation of fund by the District Mineral Foundation (DMF).

“Ultimately the state will decide, but there should be uniformity across the states in implementing the DMF,” Joshi said.