Why in the News?

• The Rajya Sabha has passed the Mines and Minerals Amendment Bill, 2025, allowing leaseholders to mine critical minerals like lithium, cobalt, and nickel without paying additional royalty.

What’s in Today’s Article?

• Mines & Mineral Amendment Bill (Introduction, Key Features, Significance, Challenges, Future Outlook)

Introduction

• India has taken a decisive step towards securing its critical mineral supply chain by passing the Mines and Minerals (Development and Regulation) Amendment Bill, 2025.
• The legislation, cleared by the Rajya Sabha after its passage in the Lok Sabha, empowers mining leaseholders to extract rare and critical minerals such as lithium, cobalt, and nickel without paying additional royalty.
• This reform is positioned as a cornerstone for India’s ambitions in clean energy, technology, and strategic industries.

About the Mines and Minerals Amendment Bill, 2025

• The Bill amends the Mines and Minerals (Development and Regulation) Act, 1957.
• Its key provision allows existing leaseholders to diversify operations by adding critical minerals to their portfolio.
• These minerals are essential inputs for advanced technologies, including electric vehicles, semiconductors, renewable energy storage, and aerospace applications.
• Additionally, the Bill strengthens the Union government’s powers to promote the development of mineral markets through the creation of mineral exchanges, ensuring transparency and efficient trading.

Significance of the Reform

• Strengthening Resource Security - Lithium, cobalt, and nickel are indispensable for batteries, electronics, and green technologies, making domestic mining critical to reduce import dependence.
• Boost to Clean Energy Transition - Access to critical minerals underpins India’s EV revolution, solar manufacturing, and renewable integration.
• Support for Strategic Sectors - From smartphones to fighter jets, these minerals are essential for India’s industrial and defence ecosystems.
• Ease of Doing Business - By removing the burden of additional royalty, the Bill incentivises companies to invest in exploration and development.

The National Critical Mineral Mission

• Union Coal and Mines Ministry highlighted that the government has identified 24 critical and strategic minerals.
• To support this effort, the National Critical Mineral Mission has been launched with an outlay of 34,000 crore, focusing on boosting domestic exploration and production, including offshore reserves.
• The National Mineral Exploration Trust has also been renamed as the National Mineral Exploration and Development Trust, signalling a stronger emphasis on both exploration and industrial development.

Challenges Ahead

• Environmental Risks - Critical mineral mining could impact fragile ecosystems and water resources.
• Global Competition - India must match international players already dominating the mineral supply chains.
• Technological Capacity - Scaling up exploration and refining requires cutting-edge technologies and significant investment.
• Geopolitical Sensitivities - Securing critical minerals is tied to global strategic competition, especially with China’s dominance in rare earth processing.

Future Outlook

• The passage of the Bill is expected to transform India’s mining sector into a strategic pillar for economic growth and self-reliance.
• By linking resource extraction with the goals of energy transition, Make in India, and national security, India is positioning itself as a serious player in the global critical minerals market.
• However, the success of the initiative will depend on balancing industrial ambitions with environmental safeguards, building domestic refining capacities, and ensuring equitable revenue sharing with states and local communities.