Mines and Minerals (Development and Regulation) Amendment Act, 2025

Posted 04 Sep 2025

Updated 10 Sep 2025

4 min read

Article Summary

The Act enhances availability of critical and strategic minerals in India through amendments like establishing National Mineral Exploration and Development Trust (NMEDT) with widened scope and territorial domain and allowing inclusion of other minerals in a mining lease. It will help to secure India's supply for energy, security, and economic growth, amid global dependency concerns.

Why in the News?

Recently, the Mines and Minerals (Development and Regulation) Amendment Act, 2025 was passed by Parliament.

More on the News

Infographic explaining the terms 'Deep Seated minerals' and 'Composite license'

The act amends Mines and Minerals (Development and Regulation) Act, 1957.
The Act was last amended in 2023 with key provisions like-
- Introduction of a new list of 24 critical and strategic minerals for increasing exploration and production.
- Empowering central government to auction mineral concessions in respect of such minerals &
- Introduction of exploration licence for critical and deep-seated minerals.
The Act will enhance availability of critical and strategic minerals in India.

Why Critical/Strategic minerals are increasingly becoming important for India?

Chinese control on Supply chain: China currently controls ~60-70% of rare earth production and 80-90% of global processing capacity.
Clean Energy Transition and Climate Goals: E.g. Silicon, Tellurium, Indium, and Gallium are used in photovoltaic (PV) cells and rare earth elements such as Dysprosium and Neodymium are used in permanent magnets for wind turbines.
Electric Mobility: E.g. Lithium, Nickel & Cobalt are key materials used in lithium-ion batteries and advanced energy storage systems and are also crucial for success of National Electric Mobility Mission Plan (NEMMP).
National Security and Defence Capabilities: Critical minerals support a wide range of military capabilities, from communications and surveillance systems to weaponry and protective gear.
Securing Digital Sovereignty: Ensuring resilient supply chain is crucial for furthering Digital Economy and technological self-reliance.
- E.g. Silicon forms the basis of microchips whereas cobalt is used to enhance memory and logic devices.
Accelerating SDG gains: It has potential to attract foreign and domestic investment, create jobs, and boost fiscal revenues, exports, and growth.
- E.g. Chile has used copper revenues to support poverty reduction (SDG 1) & improved health services (SDG 3) (UNDESA).

Key amendments and their significance

Amendment	Details	Significance
National Mineral Exploration and Development Trust (NMEDT)	Replaces earlier National Mineral Exploration Trust (NMET) with widened scope and territorial domain. NMEDT can use funds accrued to it within India, including the offshore areas and outside India, for the purposes of exploration and development of mines and minerals. Increased amount of payment to Trust by lessees (to 3% of royalty from 2%).	Supports National Critical Mineral Mission (NCMM): Expenditure of 8,700 crore rupees in next 5 years is envisaged from NMEDT under NCMM.
Inclusion of other minerals in a mining lease	Lease holders can apply to state government for adding other minerals to an existing lease. No additional amount needs to be paid for inclusion of critical and strategic minerals, and other specified minerals.	Incentivises production of critical and strategic minerals: These minerals are found in small quantity and are difficult to mine and process. E.g., Cobalt & Nickel are generally found in association with copper ores.
Inclusion of contiguous area	Allows for one-time extension of area under a mining lease (up to 10%) or composite lease (up to 30%) for deep-seated minerals.	Optimal mining of deep-seated minerals: Extraction of these minerals may not be economically viable under a separate lease or licence.
Establishment of Mineral Exchanges	Establishes authority to register and regulate mineral exchanges (a registered electronic trading platform or marketplace for trading minerals and metals). Empowers Central government to frame rules regarding mineral exchanges on matters such as registration, levy of fees, prevention of insider trading etc.	Promote investment in mining sector: It will help miners and end-users of minerals in determining fair and transparent market prices based on supply and demand dynamics.
Removal of limit on sale for captive mines	No limit on sale of minerals by captive mines. Earlier captive mines were allowed to sell only up to 50% of minerals produced in a year, after meeting end-use requirements. Captive mines allowed to sell dumps of stacked minerals which cannot be captively utilised to reduce environment hazards and increase safety in mine workings.	Bring more minerals in market and provide additional revenue to the States.

Conclusion

India's shift to green energy depends heavily on having access to critical minerals. As the country works to lower its carbon emissions and improve energy security, it's crucial to ensure a reliable supply of these essential minerals.