India’s mineral imports reached ₹10.12 lakh crore in the financial year ended March 2026, underscoring the scale of the country’s dependence on overseas mineral supplies. The government is seeking to strengthen domestic mining by improving regulatory predictability, encouraging investment and reducing the cost pressures that can make imported minerals more attractive than locally produced resources.
The development comes after Parliament amended the Mines and Minerals (Development and Regulation) Act, 1957, in 2026. The amendment, which came into force on August 22, establishes a new framework for state-level taxes and levies on mineral rights and mineral-bearing land. While the government expects a more predictable fiscal environment to support domestic production, the long-term impact will depend on investment, exploration, mine operationalisation and the resolution of concerns raised by mineral-producing states.
Key Takeaways
- Mineral imports: India imported minerals worth ₹10,12,529 crore in FY2025–26.
- Mining law amended: The MMDR Amendment Act, 2026, came into force on August 22, 2026.
- New levy framework: States can impose specified levies on mineral rights and mineral-bearing land only under conditions prescribed by the Centre.
- Auction-to-production gap: More than 720 mineral blocks have been auctioned since 2015, but many are yet to become operational.
- State revenue debate: The government says states will continue receiving around 90% of mining-sector revenue, while some states have raised concerns about their taxation powers.
- Domestic production challenge: Reducing imports will require more than legislative changes; exploration, infrastructure, investment and faster mine development will also matter.
India’s Mineral Imports Reach ₹10.12 Lakh Crore
According to government data cited by Moneycontrol, India’s mineral imports totalled ₹10,12,529 crore in FY2025–26. The figure highlights the significant role foreign mineral supplies play in supporting Indian industry.
Minerals are essential inputs for sectors including steel, cement, power generation, electronics, transportation, construction and defence. Some minerals are also important for batteries, renewable energy equipment and advanced manufacturing.
When domestic supplies are expensive, insufficient or difficult to obtain, industrial buyers may turn to overseas suppliers. This can expose manufacturers to international price movements, freight costs, geopolitical disruptions and supply-chain uncertainty.
The government argues that improving the economics of domestic mining could help India use more of its own mineral resources. However, the ₹10.12 lakh crore figure represents the reported value of mineral imports, not a confirmed amount that India could immediately save by replacing imports with domestic production.
Different minerals have different grades, uses, processing requirements and availability. Some imported resources may not be economically recoverable in India at the quantities or quality required by manufacturers.
What Has Changed Under the MMDR Amendment Act, 2026?
The Mines and Minerals (Development and Regulation) Act, 1957, is India’s principal legislation governing the development and regulation of mines and major minerals. It provides the framework for mining leases, mineral auctions, royalties and other aspects of mineral development.
The 2026 amendment introduces changes intended to create a more uniform framework for taxation associated with mineral rights and mineral-bearing land.
Its key provisions include:
- Restrictions on state levies: States cannot impose specified taxes, cesses or other levies on mineral rights or mineral-bearing land except under conditions or restrictions prescribed by the Central Government.
- Definition of mineral-bearing land: The amended law provides for a definition based on mineral content and parameters prescribed by the Centre.
- Changes to past dues: Certain levies imposed before the amendment but not paid or collected are treated as invalid under its provisions. Amounts already deposited or recovered are not subject to refund under the law.
- Central rule-making authority: The amendment expands the Centre’s role in prescribing conditions governing these levies.
The government says the changes will reduce uncertainty arising from different state-level charges and help make domestic mining more commercially viable.
The amendment does not eliminate existing mining payments such as royalties, auction premiums, District Mineral Foundation contributions or the National Mineral Exploration and Development Trust levy. These remain part of the mining-sector fiscal framework.
Why the Government Wants to Reduce Import Dependence
The government’s argument centres on the relationship between mining costs and industrial competitiveness.
Mining projects require substantial upfront investment in exploration, land access, equipment, transport infrastructure and processing. Investors must estimate costs over many years, making the predictability of taxes and regulatory requirements important.
If levies vary considerably between states or change unexpectedly, a domestic mining project may become less attractive. Manufacturers could then choose imported materials even when similar mineral resources exist within India.
A more predictable framework could help companies evaluate projects and make long-term investment decisions.
However, taxation is only one part of the cost structure. Geological conditions, mine depth, mineral grade, electricity, transport, environmental approvals and access to processing technology also affect whether domestic production can compete with imports.
Reducing imports will therefore require a combination of regulatory changes, exploration, infrastructure development and commercially viable production.
Mineral Auctions Have Not Yet Translated Fully Into Production
India has expanded its use of auctions to allocate mineral blocks since 2015. But auctioning a block does not mean that a mine immediately begins producing minerals.
Moneycontrol reported that more than 720 mineral blocks had been auctioned since 2015, while only 105 were operational at the time of its report. The government separately reported that 723 major mineral blocks had been auctioned across 17 states, with 36 blocks operationalised during FY2025–26.
These figures highlight a key challenge: moving from the allocation of mining rights to actual production.
| Indicator | Reported figure |
|---|---|
| Mineral imports in FY2025–26 | ₹10,12,529 crore |
| Major mineral blocks auctioned since 2015 | More than 720 |
| Operational auctioned blocks cited by Moneycontrol | 105 |
| Major blocks operationalised during FY2025–26 | 36 |
| Annual mineral revenue received by states in FY2025–26 | Around ₹1.14 lakh crore |
Sources: Moneycontrol and Press Information Bureau.
The difference between auctions and operational mines can reflect the time required for clearances, infrastructure, financing and development. Faster operationalisation could help increase domestic supply, although the amount of additional production would depend on each mine’s mineral type and capacity.
Why Some States Are Concerned About the New Mining Law
The amendment has also triggered a debate over the division of powers between the Centre and state governments.
Mineral-producing states collect revenue from royalties, auction premiums and other statutory payments. The government says approximately 90% of mining-sector revenue accrues to states and that the amendment does not reduce their overall share of mining revenue.
Some states, however, have objected to restrictions on their ability to impose taxes on mineral rights and mineral-bearing land. They argue that the changes affect their constitutional authority over land and taxation and could have implications for existing or proposed revenue streams.
The debate follows a 2024 Supreme Court ruling that recognised state legislatures’ authority to tax mineral rights, subject to the constitutional and statutory framework. The 2026 amendment changes that framework by placing additional restrictions on specified state levies.
The disagreement is important because states play a central role in granting mining leases, administering local requirements and supporting infrastructure around mining projects. Greater consistency could help investors, but the long-term effect will also depend on how the amended law is implemented and how legal challenges, if any, are resolved.
Which Industries Could Benefit From Higher Domestic Mineral Production?
Greater domestic mineral availability could support several parts of the Indian economy.
Steel and construction: Iron ore and other mineral inputs are essential to steel production, which feeds into buildings, transport infrastructure and industrial equipment.
Energy and power: Coal and other mineral resources remain important to parts of India’s energy system. Reliable domestic supply can reduce exposure to external disruptions.
Electronics and batteries: Critical minerals are important for batteries, electronics, renewable energy technologies and certain advanced manufacturing processes. Domestic mining alone may not be sufficient, since processing and refining capacity also matter.
Defence and strategic manufacturing: A dependable supply of selected minerals can support industries that rely on specialised metals and materials.
The benefits will differ by mineral. India may be able to expand domestic supply for some resources more readily than for others, depending on reserves, extraction costs, processing capability and demand.
The Bigger Picture
India’s ₹10.12 lakh crore mineral import bill places the focus on a central industrial-policy question: how can the country develop domestic resources while keeping mineral supplies reliable and affordable? The MMDR Amendment Act, 2026, attempts to address part of that challenge by creating a more controlled framework for specified state levies. Its effectiveness will depend on whether regulatory predictability translates into new investment and additional production.
The wider objective is not simply to reduce the value of imports. India will need to develop mines, improve exploration, expand processing and refining capacity where necessary, and ensure that domestic minerals can meet industrial requirements. The gap between auctioning a block and bringing it into production shows why legislative changes alone cannot deliver immediate import substitution.
FAQs
1. How much did India spend on mineral imports in FY26?
India imported minerals worth ₹10,12,529 crore, or approximately ₹10.12 lakh crore, in FY2025–26, according to government data cited by Moneycontrol.
2. What is the MMDR Amendment Act, 2026?
It is an amendment to India’s principal mining law that introduces changes to the regulatory framework, including restrictions on state taxes and levies on mineral rights and mineral-bearing land.
3. When did the amended mining law come into force?
The amendment came into force on August 22, 2026.
4. Will the new law immediately reduce India’s mineral imports?
Not necessarily. The law aims to improve the conditions for domestic mining, but reducing imports will depend on mine development, production capacity, mineral quality, processing infrastructure and commercial costs.
5. Why are some states opposing the amendment?
Some states have raised concerns that restrictions on specified levies affect their taxation powers and could have implications for state revenues. The Centre argues that a more uniform framework will improve predictability while preserving states’ overall share of mining revenue.
Looking Ahead
The next indicators to watch are the number of auctioned blocks that become operational, the pace of exploration, new investment in mining and processing, and changes in domestic mineral output. These measures will help determine whether the new regulatory framework translates into additional supply rather than simply changing the rules governing mining costs.
For India, lowering dependence on imported minerals will be a gradual process. The 2026 amendment is one policy measure in that effort, but its economic impact will depend on implementation, cooperation between the Centre and states, and the ability of mining companies to turn mineral resources into reliable commercial production.
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