Bill introduced to start private mining of deep-seated critical minerals

The move aims to achieve India's energy transition targets

In a significant move to bolster economic development and enhance national security, the Centre on Wednesday introduced a Bill seeking to grant exploration licence to private sector players for deep-seated and critical minerals.

The Mines and Minerals (Development and Regulation Amendment) Bill, 2023, paves the way for private sector participation in the exploration of critical minerals.

It also empowers the Centre to conduct exclusive auctions for mining lease and composite licences dedicated to certain crucial minerals, including lithium, cobalt, gallium, tantalum and tungsten, among others.
 

According to the statement of objects and reasons of the Bill, the amendments “would facilitate, encourage and incentivise private sector participation in all spheres of mineral exploration for critical and deep-seated minerals.”

The exploration licence granted through auction will permit the licencee to undertake reconnaissance and prospecting operations for critical and deep-seated minerals mentioned in the newly-proposed Seventh Schedule to the Act.

A total of 27 minerals are included in the Seventh Schedule of the Bill. These include cobalt, copper, diamond, gold, graphite, molybdenum, silver, zinc and platinum group of elements, among others.
 

According to the statement of objectives and reasons of the Bill, deep-seated minerals are difficult and expensive to explore and mine as compared to surfacial or bulk minerals. So, the share of deep-seated minerals in total mineral production is meagre at present. The country is mostly dependent on imports of these minerals.
 

Not just critical minerals, the government has also added six minerals from the list of 12 atomic minerals specified in Part-B of the First Schedule. These include beryllium-bearing minerals, lithium-bearing minerals, niobium-bearing minerals, titanium-bearing minerals and ores (ilmenite, rutile and leucoxene), tantalum-bearing minerals and zirconium-bearing minerals and ores.

These minerals have various applications across different industries like aerospace, defence, communications, electronics, energy and electric batteries. They are critical in the net-zero emission commitment of India.

Their usages may continue to evolve with technological advancements and changing market demands.
 

Exploration and mining of these minerals may increase significantly in the country.
 

This will be the fifth amendment to the Mines and Minerals (Development and Regulation) Act since 2015. The earlier changes mandated a method of auction for grant of mineral concessions to bring transparency, establishing the District Mineral Foundation, removing the distinction between captive and merchant mines and removing the restrictions on transfer of mineral concessions.The lack of availability of critical minerals or concentration of their extraction or processing in a few geographical locations may lead to supply chain vulnerabilities and even disruption of supplies.

The future global economy will be underpinned by technologies that depend on minerals such as lithium, graphite, cobalt, titanium, and rare earth elements. Critical minerals have gained significance in view of India’s commitment towards energy transition and achieving net-zero emission by 2070, the statement added.
 

Even in case of auction by the Centre, the mineral concession will be granted to the selected bidders by a state government only. The auction premium and other statutory payments will accrue to the state government.