Article
The Mines and Minerals (Development and Regulation) Amendment Act, 2026 represents a landmark reform in India’s mineral governance under the MMDR Act, 1957. Passed by the Lok Sabha on 12 August and the Rajya Sabha on 13 August 2026, the legislation seeks to combine fiscal predictability with stronger national oversight of mineral resources. At its core, the Act addresses persistent challenges like uneven State-level taxes, cesses, duties, retrospective demands and the imposition of new levies after mining operations have commenced. These practices as undermines mine viability, discourages investment, disrupts domestic supply chains and erodes mineral competitiveness.

A key feature of the Act is Section 9D, which regulates State Governments from introducing new taxes, cesses, or duties on mineral rights or mineral-bearing land, except under conditions prescribed by the Centre. Significantly, duties or levies left unpaid or uncollected by States prior to the amendment’s commencement are to be cancelled, though amounts already deposited or recovered will not be refunded. Together, these provisions aim to provide mining sector with greater certainty and shield them from retrospective fiscal liabilities.
Importantly, the reform does not signal a retreat of States from the mineral economy. Government and Coal India communications emphasise that States will continue to receive nearly 90% of mining-sector revenue. In fact, State mining revenues have grown sharply from ₹25,206 crore in 2014–15 to ₹1,14,549 crore in 2025–26, an increase of about 354%, with cumulative accruals exceeding ₹7 lakh crore since 2014. Moreover, nearly 50 minor minerals including sand, gravel, boulders and murram shall continue to remain under State jurisdiction, ensuring their continued role in local resource management.
The Act also fits into a broader reform trajectory. Earlier MMDR amendments introduced auction-based allocation, District Mineral Foundations, the National Mineral Exploration Trust, expanded private participation in exploration, Central auctioning of critical minerals and exploration licences for deep-seated deposits. The 2025 amendment, effective September 2025, further advanced critical-mineral development by enabling inclusion of associated minerals, contiguous areas for deep-seated deposits, expanded mine-development support and removal of the earlier 50% ceiling on captive-mine sales, subject to end-use requirements. Subsequent 2026 rules operationalised these provisions, including contiguous-area additions of up to 10% for mining leases and 30% for composite licences.
Taken together, the 2026 Amendment Act signals a decisive shift towards a nationally coordinated and predictable mineral regime. It is designed to foster exploration, investment, critical-mineral security, domestic production, and industrial self-reliance.

Please follow and like us: