New Delhi: The Centre has called for wider use of digital technology and advanced surveillance systems across India’s mining sector to curb illegal extraction, dismantle mining syndicates and prevent mineral smuggling.
Addressing a conference of state mining ministers, Union Minister for Coal and Mines G. Kishan Reddy said a lack of transparency, weak accountability and political interference had contributed to illegal activities in mineral-rich regions.
He urged state governments to introduce technology-driven monitoring systems to track mineral extraction, transportation and exports. He also called for clear accountability among administrative officials and regulatory agencies to prevent illegal mining operations.
Push for technology and private investment
Reddy said political interference had affected transparency in the mining sector and discouraged private investment. He asked states to create a more transparent regulatory environment and encourage private companies to bring in capital, advanced technology and international operational practices.
He pointed out that 100 per cent foreign direct investment is permitted in the mining sector. Greater private participation, combined with digital monitoring, could improve operational efficiency and help prevent illegal extraction, he said.
States receive up to 96 per cent of mining revenue
Highlighting the financial benefits of mining reforms, the minister said state governments receive approximately 94 to 96 per cent of total revenue generated from mining activities. Collections from the sector have crossed Rs 70,000 crore.
He added that funds collected through the District Mineral Foundation remain with the states, which also receive a 50 per cent share of the Goods and Services Tax (GST) levied on minerals.
Reddy said improved monitoring and transparent revenue collection would strengthen state finances.
Coal production crosses one billion tonnes
The minister also highlighted India’s progress in mineral and coal production. The country’s coal output has crossed the one-billion-tonne mark, while the production value of major minerals stood at approximately Rs 1.8 lakh crore in 2025.
The mining industry provides direct and indirect employment to more than one crore people.
To strengthen domestic production capabilities, the Centre has allocated Rs 46,000 crore for coal gasification initiatives and around Rs 32,000 crore for the critical minerals sector. Reddy also encouraged states to establish dedicated critical mineral parks to promote domestic processing.
Mineral trading exchanges planned
The Centre is preparing dedicated coal and mineral trading exchanges to make transactions more transparent and improve price discovery. These platforms will allow state governments and private mining leaseholders to trade minerals through organised market mechanisms.
The government has also permitted duty-free imports of 24 critical minerals to address supply-chain constraints and ensure the availability of essential raw materials for domestic industries.
Focus on mine workers’ safety
Reddy stressed that the expansion of mining operations must go hand in hand with worker safety and welfare, particularly for those employed in hazardous underground mines.
He referred to enhanced compensation provisions for workers affected by industrial accidents and said production targets should not compromise human safety.
The Centre’s proposed reforms combine digital surveillance, private investment, transparent mineral trading, critical mineral development and worker protection to strengthen governance and curb illegal mining across the country.
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