The Indian Parliament has passed the Mines and Minerals (Development and Regulation) Amendment Bill, tightening central control over mineral levies, aiming to stabilise the sector after legal disputes and attract investors amid a push for increased mineral production.
Parliament has passed the Mines and Minerals (Development and Regulation) Amendment Bill, 2026, giving the Union tighter control over how mineral-related levies are imposed and narrowing the scope for states to introduce new taxes, cesses or charges on mineral rights or mineral-bearing land without meeting conditions laid down by the Centre. The move marks a sharper centralisation of mineral tax policy at a time when India is trying to offer greater certainty to investors in mining and processing.
The change comes against a backdrop of a long-running legal dispute over who has the power to tax mineral resources. Under the Mines and Minerals (Development and Regulation) Act, 1957, the Union already regulates mines and minerals declared to be of public interest, while states have traditionally argued that they retain authority under the State List to tax mineral-bearing land. A 2024 nine-judge Supreme Court ruling in Mineral Area Development Authority v. Steel Authority of India held that states have independent legislative competence to levy taxes on mineral rights, separate from royalties paid to the Union. That decision triggered a wave of retrospective demands from several states, in some cases amounting to more than ₹1.5 lakh crore, and intensified concern among miners and investors over the scale of potential liabilities.
The amendment also fits with a broader policy push to expand production and improve flexibility in the sector. According to the International Energy Agency, a separate amendment to the MMDR framework in 2025 was designed to accelerate mineral output, support a minerals market and widen the role of the National Mineral Exploration and Development Trust so it can fund exploration and development at home and abroad. Taken together, the changes suggest the government is seeking not only to resolve the tax uncertainty exposed by the Supreme Court ruling but also to strengthen the investment case for a sector central to industrial growth and the energy transition.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
