Policy

Centre amends rules to ensure that states extend leases of mines owned by PSUs

Our Bureau New Delhi | Updated on October 01, 2019 Published on October 01, 2019

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Minister Dharmendra Pradhan welcomes the move, says it ensure raw material security for the steel sector

The Centre has amended mining rules to ensure that state governments extend mining leases of mineral blocks that are held by public sector undertaking (PSU) companies.

The Ministry of Mines has amended the Minerals (Mining) by Government Companies Rules, 2015. It has substituted “may, for reasons to be recorded” in rule 3, in sub-rule (2) and rule 4, in sub-rule (3) with “shall, for reasons to be recorded”, an official statement said.

This implies that all mining leases granted to government companies shall be extended by the state government for up to twenty years at a time. The extension will have to be granted by the state if an application is made by the government company or corporation at least twelve months prior to the expiry of the mining lease, the statement said.

‘Positive effect’

Commenting on the decision, Steel Minister Dharmendra Pradhan said, “This is an important step towards ensuring raw material security for Indian steel sector. It will also ensure price stabilisation of raw materials, and will have positive effect on the secondary steel sector.”

As per provision of Section 8A(6) of Mines and Minerals (Development & Regulation) Act, 1957 (in short, MMDR Act, 1957), the lease of 31 working mines of iron ore are expiring on March 31, 2020.

This amendment does not provide relief to private sector miners seeking an extension to mining leases expiring in March 2020.

Published on October 01, 2019
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