Panaji, Nov 5 Union minister G Kishan Reddy on Thursday said the Centre does not collect revenue from mining activities, with up to 96 per cent of the sector’s income going to state governments, and asserted that this arrangement would continue.
The Centre’s approach towards the mining sector was not driven by revenue generation but by ensuring availability of minerals required for the country’s development and creating employment opportunities, the Coal and Mines Minister said while addressing a conference of mining ministers in Goa.
The central government does not collect any money from royalty, auction premium or the District Mineral Foundation (DMF) and its share of revenue is limited to 50 per cent of the GST collected on minerals, he said.
“I want to make it clear that the Government of India is not taking any revenue from the mining sector. Whatever revenue is generated through mining, 94 to 96 per cent goes to state governments, and this arrangement will continue,” he said.
He said the state governments’ revenue from non-coal mining has increased from around Rs 13,000 crore in 2014-15 to more than Rs 70,000 crore at present.
The entire DMF collection goes to the state governments, he said, adding that around Rs 1.36 lakh crore have been accumulated under the fund.
“Whether it is auction premium, royalty or DMF, the Centre does not take even a single rupee from these sources. The revenue belongs to the states,” he said.
Instead of collecting revenue from the mining sector, the Centre was investing in it through various incentive schemes, according to him.
Referring to the coal gasification initiative, he said the government has earmarked financial incentives worth Rs 46,000 crore to promote projects in the sector. It is also investing substantial funds in developing the critical minerals ecosystem, he added.
The minister said the government was working on developing a strong domestic ecosystem for critical minerals, covering exploration, processing and recycling.
Reddy also said that India has crossed the historic milestone of one billion tonnes of coal production, while the value of major mineral production has increased four-fold over the last decade to Rs 1.89 lakh crore in 2025.
The country’s coal and mining sectors were undergoing significant transformation through reforms focused on transparency, technology, professionalism and digitalisation.
He said India was committed to adopting the world’s best practices in mining, moving away from the inefficiencies that had earlier affected the sector.
“Today, with new reforms, such as transparency, technology, professionalism and digitalisation, India’s coal and mining sectors are moving forward with a firm commitment to implementing the world’s best mining practices in the country,” he said.
Reddy thanked the private sector for collaborating with central and state public sector undertakings (PSUs) to introduce and implement new technologies in the country’s mining industry.
The mining sector had generated approximately 1.3 crore employment opportunities in the country, apart from creating substantial indirect employment through allied activities, according to the minister.
The value of major mineral production stood at Rs 1.89 lakh crore in 2025, marking a four-fold increase over the last 10 years, he said.
“The government does not look at the mining sector merely from the perspective of revenue generation. Our primary focus is ensuring the availability of minerals required by the country and creating more employment opportunities,” Reddy said.
The collaboration between private companies, central PSUs and state government PSUs would be crucial in bringing advanced technologies and global best practices to India’s mining sector, he said.
The minister emphasised that continued reforms and technological interventions would help make the country’s coal and mining industries more transparent, efficient and professionally managed.
“Mining has now become a matter of India’s economic security and strategic security,” he said, referring to the rapidly changing geopolitical situation and challenges facing global supply chains.
Reddy called for closer coordination between the Centre and state governments to address disruptions in global mineral supply chains and make India a reliable partner in the international market.
He said India was rich in natural resources and the country needed to utilise its mineral wealth to serve national interests, generate employment and increase state revenues.
Where mining has not taken place, the focus should be on starting exploration and mining activities, while regions with existing mining operations should develop the entire value chain, including processing, refining and recycling, he said.
Reddy said India must work collectively to meet its growing domestic requirements while emerging as a strong and dependable partner in global mineral supply chains.
(PTI News)
