India is seeking further amendments to the Mines and Minerals (Development and Regulation) Amendment Act 2023 to include specific use of funds – currently earmarked at ₹5,600 crore — for probable exploration of critical mines overseas. It also proposes to include a tailings policy and changes in royalty structure aiding critical mineral extraction from wastes.
The changes are likely to be introduced in the upcoming Monsoon Session of the Parliament, officials aware told businessline.
The amendments are expected to further the National Critical Minerals Mission (NCMM) which aims to secure supplies for commercial usage of these minerals – identified mostly for their strategic importance. The NCMM with an expenditure of ₹16,300 crore over a period of seven years, from FY 2024-25 to 2030-31, and another ₹18,000 crore is expected to be invested by the CPSEs. NCMM includes promotion of recovery of critical minerals from tailings by using various technologies.
India has so far identified 24 critical minerals – that include the likes of lithium, cobalt, vanadium, rare earth elements (REE), platinum group of elements (PGE), nickel, niobium, germanium, berylium, tantalum, stronium, among others.
According to VL Kantha Rao, Union Mines Secretary, the amendments would help take the NCMM forward.
“We are planning to bring in amendments to help the Mission,” he told businessline, on the sidelines of the Critical Mineral Processing Seminar organised by the Mines Ministry.
Overseas exploration
Amongst the amendments proposed, a major one would be use of NMET (National Mineral Exploration Trust) funds for carrying out exploration activities in overseas mines.
At present, the NMET Fund was set up to fund mineral exploration activities in India, primarily through regional and detailed projects. It is funded by a contribution equivalent to 2 per cent of the royalty paid by mining lease holders. The current NMET corpus is approximately ₹6,000 crore.
Further use of funds for setting up processing facilities overseas can also be looked at, a senior official said.
India has recently secured mineral blocks in Zambia spread across 9,000 sq kms, and NMET funds could be used to explore copper and cobalt resources there.
Under the NCMM, nearly ₹5,600 crore has been earmarked for overseas projects over a 2024-25 – 2030-31 period (six years). This include ₹4,000 crore as risk coverage for foreign sourcing and ₹1,600 crore for support of exploration activities outside India. Both the funds are to be from NMET, and in order for it to happen, necessary amendments in the Act have to be made.
Tailings policy and royalty rework
India would also look to introduce a tailings policy – and incentivise the same for private players – so that extraction of critical minerals can be secured from dumped bulk mineral waste.
A revised royalty structure to aid beneficiation from such tailings and help bring in private investments is being worked out and will be introduced as a part of these changes too.
Tailings, which are byproducts created during the mineral extraction process, consist of finely ground rock, water, and chemicals used in processing. These materials may exist in various forms, such as liquid, solid, or slurry.
Metals like barytes, feldspar, mica and quartz, which were previously classified as minor minerals for industrial uses (such as construction or ceramics), are now required to be examined for their potential as critical minerals. This shift aims to ensure that valuable critical minerals associated with these resources are properly extracted and reported.
India at present does not have a tailings policy and discussions on it has been under works for some time now.
Sources said, a ₹1,500 crore critical mineral recycling scheme is being worked out as part of the NCMM. This scheme will include recovery from overburden, tailings, fly ash, red-mud, among others. Around ₹100 crore will be provided through NMET.
Stockpiling (for critical minerals) – by acquiring resources and supplies or finished offerings being stocked up – and setting up of processing parks at ₹500 crore each has also been proposed. Funds are to be provided through the Budget.