By S&S Co. Advocates & Solicitors · Published 24 September 2026 · Informational content, not legal advice — see our disclaimer
Major vs Minor Minerals: Two Different Regimes
Mining of 'major minerals' is governed by the Mines and Minerals (Development and Regulation) Act, 1957, substantially amended in 2015 and subsequently, and is granted primarily through competitive auction conducted by the state government. 'Minor minerals', by contrast, are regulated separately by each state government under its own rules, so the process and requirements can differ considerably depending on which category the mineral in question falls into.
How the Auction-Based Grant Process Works
For major minerals, an applicant participates in the state government's e-auction process for notified and already-prospected blocks. Where a block has not yet been put up for auction, limited circumstances may still allow an application in the prescribed form under the Mineral Concession Rules, 1960, though the auction route is now the dominant mechanism following the 2015 amendment to the MMDR Act.
Grant of a lease additionally requires that the area has been properly prospected and its reserves established, and that an approved Mining Plan — together with a Mine Closure Plan — has been sanctioned by the Indian Bureau of Mines or the relevant state authority. For coal and lignite specifically, prior Central Government approval is also required before a lease can be granted.
Ongoing Financial Obligations After Grant
A mining lessee is required to contribute to the District Mineral Foundation (DMF) and the National Mineral Exploration Trust (NMET) as prescribed under the Act and its Rules. These are recurring obligations tied to the lease's operation, not one-off charges payable only at the point of grant, and should be factored into the ongoing cost of running the mine.
Environmental and Forest Clearances Are Separate Preconditions
Even once a mining lease itself has been granted, Environmental Clearance under the EIA Notification, 2006, and — where the area involves forest land — Forest Clearance under the Forest (Conservation) Act, are separate, mandatory preconditions that must also be obtained before mining operations can actually commence. A lease grant alone does not authorise mining to begin; operators need to track these clearances as parallel, independent requirements.
Lease tenure, renewal norms, and procedural variations — particularly for minor minerals, where each state sets its own rules — should be checked against the applicable state's current mineral concession rules, since this is an area that has seen frequent legislative change.
Frequently Asked Questions
What is the difference between major and minor minerals for mining purposes?
Major minerals are governed by the central MMDR Act, 1957 and granted primarily through state-government e-auction; minor minerals are regulated separately by each state government under its own rules, so the process varies by state.
What must be in place before a mining lease can actually be operated?
An approved Mining Plan and Mine Closure Plan sanctioned by the Indian Bureau of Mines or state authority, plus (separately from the lease itself) Environmental Clearance and, where forest land is involved, Forest Clearance.
What recurring payments does a mining lessee owe after grant?
Contributions to the District Mineral Foundation (DMF) and the National Mineral Exploration Trust (NMET), as prescribed under the MMDR Act and Rules.
Does getting a mining lease automatically allow mining to start?
No. Environmental Clearance, and Forest Clearance where applicable, are separate mandatory preconditions that must be obtained in addition to the lease before operations can commence.
References & Further Reading
This article references the following statutory provisions. Readers should always verify current rules, fees and timelines against the applicable statute and rules as amended, since these are revised from time to time.
- Mines and Minerals (Development and Regulation) Act, 1957, as amended (particularly by the MMDR Amendment Act, 2015).
- Mineral Concession Rules, 1960, and applicable state mineral concession rules for minor minerals.
- Environment Impact Assessment Notification, 2006, and the Forest (Conservation) Act, 1980.