Mineral Laws (Amendment) Bill, 2020 - Future of Mining Sector

India has a lot of coal reserves, which are unused and if the same continues then the said Coal will go undiscovered and untapped, which will eventually just turn into mud.

India has a lot of coal reserves, which are unused and if the same continues then the said Coal will go undiscovered and untapped, which will eventually just turn into mud. Therefore, to aid the discovery and encouragement of these industries the Indian Parliament cleared the Mineral Laws (Amendment) Act, 2020 to amend the earlier Act viz: Mines & Mineral (Development and Regulation) Act, 1957 and the Coal Mines (Special Provisions) Act, 2015. This Bill replaces the ordinance for amendment of the Mines and Mineral (Development and Regulation) Act, 1957 and Coal Mines (Special Provisions) Act, 2015, which was promulgated on 10th January 2020.Prior to this legislation, the Mines and Mineral (Development and Regulation) Act, 1957 was the principal Act that governed all the mining-related activities. Both the acts together provided the elementary structure to the mining sector in India. However, the Mineral laws (Amendment) Bill, 2020 is an important legislation, as India would now be using its own natural resources instead of any imported resources like coal.
 
The Bill is different from the earlier traditional legislations, which governed the sector in many way. The Salient features of the Bill are as follows:
 
(1)  This new legislation enables companies to participate in the auction of coal and lignite blocks, even if they don’t have prior experience of coal mining in India. This action will help boost the operation of FDI policy in the coal sector to large extent
 
(2)  After this legislation companies not involved in any precise type of end-use may join in the auction of Schedule II and III coal mines, as the last usage barrier is removed. This will allow more involvements in auction of coal mines for a variety of purposes viz: utilisation, selling or for purposes, as may be specified by the Central Government.
  
(3)  After this legislation environmental and forest clearances can be transferred to the new owners of the mineral blocks along with other clearances for two years, without hassle. Thus the companies can apply for new licenses for two years during the period.
 
(4)  The stress in the Bill was on exploiting reserves without harming the environment.
  
(5)  This legislation allows prospecting licence-cum-mining lease for coal/lignite and this increases the obtainability of coal & lignite blocks.

(6)  The Sale or Auction of lease of the various mines can now be started before expiry of lease period. This will help in unified production of minerals in the country with new users getting a chance to decide if they want to venture into the business.
 
 
The way ahead for the mining sector
 
This sector prior to this legislation was going rancid and one of the reasons was lack of organisation among the market players and reluctance of new companies from investing in this sector. The bill will open up the coal sector for commercial mining and allow domestic, as well as global companies to invest in this sector with all the boost being provided to the existing as well as the new entrants by this legislation. Thus a new epoch of doing business has been introduced in this sector because of the various relaxations, as mentioned in the salient features above. Otherwise this was a sector operating very traditionally with lots of restrictions. Hence, with the opening up of auctions there will be wider participation in the auctions without hesitation of having prior experience in the field by newer players. India’s top ranking state in Coal reserves viz Jharkhand and others can be tapped for the coal resources to the maximum without resorting to imports. Healthy competition within the country can be set up and the various companies will all bring in the modern means of technology to tap the coal resources and gain the maximum profit. Therefore, this Bill will definitely help create the well-organised market in the minerals and mining sector.