New Delhi — The recently passed Mines and Minerals Amendment Bill, 2026, is aimed at bringing greater stability and predictability to India’s major minerals sector while encouraging fresh investment, the Central government said on Saturday.
The government said the amendment to the Mines and Minerals (Development and Regulation) Act, 1957, seeks to address concerns over the uneven and steep levies imposed by some states, which can make domestically produced minerals less competitive and encourage greater dependence on imports.
“Unconstrained and uneven state levies weaken public interest by making domestic minerals uncompetitive, incentivising unnecessary foreign imports despite abundant local reserves,” the government said in a clarification note.
According to the government, excessive variations in levies can also fragment the domestic mineral market and affect the competitiveness of Indian mining operations.
However, it made it clear that the amendment does not take away the states’ existing rights over land and minerals or their authority to collect taxes on minerals.
“Currently, out of the total taxes and statutory payments in mining, around 90 per cent accrues to the states and this arrangement will continue even after the amendment,” the government said.
The amendment also does not affect the power of states to regulate or impose taxes on minor minerals.
The government said the key objective is to establish a more certain, stable and predictable fiscal framework for the mineral sector. Greater policy certainty, it said, could improve the investment climate, encourage domestic exploration and mining and support the broader objectives of Atmanirbhar Bharat and the vision of Viksit Bharat 2047.
The issue assumes importance as minerals are essential for infrastructure development, manufacturing, energy security and several emerging industries, including clean energy and advanced technologies.
India imported minerals worth Rs 10,12,529 crore in FY26, highlighting the scale of the country’s dependence on overseas supplies and the need to strengthen domestic mineral production.
At present, mining operations are subject to several forms of taxes, charges, fees and statutory payments imposed by different authorities. These include royalty, auction premium, dead rent, contributions to the District Mineral Foundation (DMF), Goods and Services Tax (GST) and transit fees, among others.
Despite concerns over the cumulative burden of these levies, the government stressed that states remain the primary beneficiaries of mining-related revenues. Around 90 per cent of total revenue from mining currently accrues to the states.
More than Rs 5 lakh crore has accrued to major mining states between FY16 and FY26, while the Centre received around Rs 82,000 crore during the same period, according to the government.
The government said this broad revenue-sharing position will remain unchanged following the amendment.
The new framework is therefore being positioned not as a reduction in the states’ role in mineral administration or revenue collection, but as an attempt to bring greater uniformity and predictability to the fiscal environment. The Centre expects this stability to encourage investment in domestic mining and reduce avoidable dependence on imported minerals.
With inputs from IANS