The Mines and Minerals (Development and Regulation) Amendment Bill 2021 is a significant step taken by the Indian government to address the flaws and obstacles in the mining sector. The aim of the amendment is to boost India's GDP to $5 trillion and double the job potential in the next five years. This blog provides an overview of the salient features of the amendment and its implications for UPSC aspirants.
Background
The Mines and Minerals (Development and Regulation) Act, 1957, regulated the mining sector in India but had certain limitations. Recognizing the need for reforms, the government has undertaken several measures since 2015 to address these issues and promote the growth of the industry.
Salient Features of the Amendment
The Mines and Minerals (Development and Regulation) Amendment Act, 2021 introduces several key changes:
a) Elimination of Distinction: The amendment abolishes the differentiation between captive and merchant mines, allowing all captive mines to sell up to 50% of the minerals they produce. This facilitates optimal mining practices and ensures a timely commencement and continuity of production.
b) End-Use Restrictions: Future auctions will be conducted without any end-use restrictions, except for coal, lignite, and atomic materials. The government will have the authority to reserve mining leases for leasing through auctions.
c) Redistributing Non-Producing Mining Blocks: Non-producing mining blocks of government companies will be redistributed to ensure timely production and efficient utilization of resources.
d) Continuity in Mining Operations: Statutory clearances of expired mining leases will continue even after expiry or termination and will be transferred to the next lessee. This ensures continuity in mining operations and avoids disruptions.
e) Transfer of Mineral Concessions: All mineral concessions can be transferred without any charges, streamlining the process and encouraging investment in the sector.
f) Definition Clarification: The amendment clarifies the term "without lawful authority" to avoid confusion in enforcing penalties.
g) Auctions by Central Government: In cases where states face difficulties or fail to meet deadlines, the central government can conduct auctions, ensuring a smooth process and promoting transparency.
h) Amendment of the Second Schedule: The rates of royalty for certain minerals and metals have been amended in the second Schedule of the Mines and Minerals (Development and Regulation) Act, 1957.
Implications of the Amendment
The Mines and Minerals (Development and Regulation) Amendment Act, 2021 has several implications for the mining sector and the overall economy:
a) Optimal Mining: Removing end-use restrictions promotes optimal mining practices, ensuring efficient utilization of resources and timely production.
b) Development of Industries: Industries located close to mining areas, particularly in remote regions, will be promoted. This will contribute to regional development and create employment opportunities.
c) Increased Revenue for States: The availability of more mining blocks for auction will lead to increased revenue for the states, supporting their economic growth and development.
d) Streamlined Approvals: Continuity in mining operations eliminates the need for repeated approvals and permits, streamlining the process and reducing administrative burden.
e) Equal Playing Field: The amendment creates an equal playing field for both public and private organizations, encouraging exploration and the adoption of advanced technologies in mineral exploration.
f) National Mineral Exploration Trust (NMET): NMET will become an autonomous body and collaborate with public and private organizations to advance exploration efforts, promoting the discovery of new mineral reserves.
g) Employment Opportunities and Investment: The amendment aims to unlock the full potential of the mineral sector, leading to increased employment opportunities, investment, and revenue for the states.
Conclusion
The Mines and Minerals (Development and Regulation) Amendment Act, 2021 is a significant step towards promoting transparency, efficiency, and growth in the mining sector. It aims to boost India's GDP and create job opportunities while ensuring the sustainable utilization of mineral resources. Aspiring UPSC candidates should stay updated with such reforms as they play a crucial role in shaping India's economy and governance.
Note for UPSC Aspirants: For UPSC aspirants interested in exploring further, here are some keywords to guide your research: Mining sector reforms, National Mineral Exploration Trust (NMET), Optimal mining practices, Sustainable resource utilization.
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