The Centre has unveiled a Rs 50 billion (bn) incentive scheme to accelerate mining reforms and boost production in the mineral sector. The initiative is intended to encourage faster operationalisation of mines and improved governance by providing financial support to states that implement prescribed reforms. The scheme will allocate funds on a first-come, first-served basis to states that streamline administrative processes and adopt technology driven monitoring systems.

The programme is divided into three components. The first component, with an outlay of Rs 20 billion (bn), will reward states that complete key reform measures such as integration with the national mining portal, establishment of coordination committees and publication of annual auction calendars. Eligibility under this component requires demonstrable action on administrative reform and information transparency.

The second component, with Rs 25 billion (bn) earmarked for mine operationalisation, provides incentives to address land acquisition, environmental clearances and logistical preparedness that delay production. States will receive Rs 200 million (mn) per mineral block auctioned with pre embedded clearances subject to a cap, while an additional Rs 2.5 billion (bn) is tied to achieving operationalisation of at least 10 per cent of auctioned blocks within a specified timeline. The design aims to reduce time to production and unlock stalled projects.

The third component links incentives to performance under the State Mining Readiness Index and sets aside Rs 6.75 billion (bn) to reward top performing states across categories. The ministry of mines will evaluate reform progress, recommend eligible states for disbursal and set timelines for proposal submissions and approvals. Officials said the package seeks to increase mineral output, enhance state revenues and improve transparency in allocation and monitoring.