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National Mineral Policy 2019 

National Mineral Policy 2019

National Mineral Policy 2019 

The Ministry of Mines has initiated a new policy called “National Mineral Policy” which aims for the comprehensive exploration of the country’s mineral resources. This policy proposes to grant the status of industries to mining activity to hike the financing of mining for the private sectors. This policy aims to assure effective regulation and sustainable development of the mining sector. Let us look in detail about the National Mineral Policy 2019 in this article.


The aim of National Mineral Policy is to have a more effective and implementable policy that leads to further transparency, better regulation and enforcement, balanced social and economic growth as well as sustainable mining practices. This new policy ensures more effective regulation sustainable mining sector development while addressing the issues of the project affected persons especially those residing in the tribal areas.

Key proposals of the National Mineral Policy

  • It proposes to increase the production of major minerals by 200% in seven years, and reduce trade shortfall in the mineral sector by 50% in seven years.
  • It aims to bring private investment through the incentives such as financial package, right of the first refusal at the event of the auction or any other appropriate purpose according to the international practices.
  • It introduces the concept of Exclusive Mining Zones that will come with in-principle statutory clearances for the issuance of mining lease.
  • It emphasises on simplifying the clearance method and making it time-bound for the development of mineral and commencement of mining operations.
  • It proposes to identify critically fragile ecosystems and declare such areas as “no-go areas” or “inviolate areas”.
  • This policy encourages merger and acquisition of mining entities and transfer of mining leases that have been granted in a transparent manner to ensure a seamless supply of ores and scaling up of business.
  • This policy focuses on long term export-import provisions for the mineral sector to create stability for investing in the large scale commercial mining activity.
  • It proposes harmonising royalty and all other levies and taxes with the mining jurisdiction across the world.
  • It emphasises on securing the welfare of the mining-affected people/ communities and also assuring rehabilitation and resettlement, by the suitable implementation of every relevant Acts or Rule.
  • It brings the concept of Inter-Generational Equity in mineral resource exploitation.
  • It proposes the development of an over-arching inter-ministerial body, under the aegis of the Ministry of Mines, to institutionalise mechanisms of sustainable mining. It will also advise the Government on rates of royalty, dead rent etc.

Long term Import Export policy and FDI

Minerals continue to be an important origin of foreign exchange earnings. For exports, the policy would keep in view the dynamics of mineral inventories as well as the short term, medium and long term demands of the country. The import of minerals would be adjusted as far as possible with the inherent development of mineral-based industries. The areas of cooperation with other countries having complementary resource base would be developed for the mutual advantage. This approach would be to make mineral-based materials available to domestic users at reasonable prices as determined by market forces. To develop mining as a modern stand-alone industry substantial investment is required. A long term export-import policy for the mineral sector will contribute stability and prove to be an incentive for funding in large scale financial mining activity. Assurances, through such a policy for minerals, will be a key factor for the investment decisions, particularly Foreign Direct Investment (FDI) decisions in the sector.

Provisions of the Policy

The National Mineral Policy that includes the following provisions which will give a boost to mining industries are as follows:

  • The policy has introduced the Right of First Refusal for RP/ PL holders of reconnaissance permit and prospecting license.
  • This policy focuses on encouraging the private sector to take up for the exploration of mining industry development.
  • It also provides for the auctioning in virgin areas for the composite RP cum PL cum ML on a revenue share basis.
  • It assures for the encouragement of merger, acquisition of mining entities, mining leases transfer of and production of dedicated mineral corridors to support the private sector mining areas.
  • The 2019 Policy proposes to give the status of industry to mining activity to hike the financing of mining for the private area and for acquisitions of mineral assets in other countries by the private sector.
  • It also mentions that long term import-export policy for mineral will help the private sector in better planning and stability in business
  • The Policy states to rationalize reserved areas given to the Pubic Sector Undertakings (PSUs) that have not been used and to put these areas on auction, which will give more opportunity to the private sector for participation
  • The Policy also ensures to make efforts to harmonize taxes, levies and royalty with the world benchmarks to help all the private sectors.

Financial Support for Mining

Mining is a suitable activity for obtaining financial assistance from financial institutions. However, at present only those mining projects that have a substantial component of mining equipment, machinery and buildings are being financed. The proposed steps would be taken to facilitate funding of prospecting, exploration and mine development. The efforts would be made to grant mining the status of the industry.

Safety of mines and mine-workers

Mining operations at circumstances are hazardous in nature. The efforts required to be directed towards the development and adoption of mining practices that would increase the safety of workers and reduce accidents. The participation and cooperation of workers would be achieved. The steps will also be taken to minimise the adverse impact of mining on the safety and health of workers and the surrounding population. The DGMS to be faraway strengthened through adequate manpower, equipment, and skillsets in order to bring out the regulatory role for ensuring miners’ health and mine safety effectively.