The Centre-states tussle over the Mines and Minerals Bill
Highly relevant to UPSC Mains GS-II (Polity & Federalism). Understanding centre-state relations, resource management, and constitutional provisions is crucial.
UPSC Relevance
Maps to GS Paper II (Polity & Governance) and GS Paper III (Economy) — federalism, resource management, and Centre-state relations.
What You Need to Know
The Mines and Minerals (Development and Regulation) Amendment Bill seeks to amend the MMDR Act, 1957, which regulates mining and mineral development in India. The tussle involves states' demand for greater control over mineral resources and revenue sharing, versus the Centre's push for uniform policy and auction-based allocation.
Why It Matters for UPSC
This issue is central to India's federal balance, as minerals are a state subject under the Seventh Schedule (Entry 23, List II), but the Centre regulates them under the MMDR Act. It impacts resource-rich states' revenues, local development, and the ease of doing business in the mining sector, making it a key governance and economic challenge.
Background
The MMDR Act, 1957, was amended in 2015 to mandate auction-based allocation and create the District Mineral Foundation (DMF). The current bill proposes further changes, including allowing states to auction mines whose leases have expired, and introducing a new royalty regime, leading to friction over revenue sharing and regulatory authority.
Current Relevance
The bill is pending in Parliament, with states like Odisha and Jharkhand opposing provisions that may reduce their revenue share. The dispute highlights the ongoing Centre-state friction over natural resources, impacting investment and federal harmony.
Key Points for Revision
- •Minerals are in the State List (Entry 23), but the MMDR Act, 1957, enacted under Entry 54 of Union List, allows Centre to regulate them.
- •The 2015 amendment made auction the sole method for allocating mineral concessions.
- •The proposed bill aims to allow states to auction mines with expired leases, but states fear revenue loss due to proposed royalty changes.
- •DMF funds local development; states want higher contribution from miners.
- •The tussle reflects broader federalism issues: resource control, revenue sharing, and cooperative federalism.
Prelims Practice MCQs
Q1. Consider the following statements: 1. Minerals are in the State List under the Seventh Schedule. 2. The MMDR Act, 1957, was enacted under Entry 54 of the Union List. Which of the statements is/are correct?
Minerals are a state subject (Entry 23, List II), but the Centre can regulate them under Entry 54, List I, which allows Parliament to legislate on mineral resources. Hence both statements are correct.
Q2. The Mines and Minerals (Development and Regulation) Amendment Act, 2015, introduced which of the following?
The 2015 amendment mandated auction-based allocation and established the District Mineral Foundation (DMF) to benefit affected communities. Thus, both (b) and (c) are correct.
Q3. Which of the following best describes the core issue in the Centre-state tussle over the Mines and Minerals Bill?
The dispute centres on how mineral revenues are shared and who has regulatory authority, reflecting federalism and resource management issues.
Mains Practice Questions
The Centre-state tussle over mineral resources reflects deeper federal tensions. Discuss the constitutional provisions and the recent amendments that have shaped this dispute. (250 words)
DiscussExamine the implications of the proposed Mines and Minerals (Development and Regulation) Amendment Bill on federalism and resource management in India. (150 words)
Examine