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UPSC Notes

Mineral Governance and Federalism

PYQs

8

Articles

1

Momentum

21

Phase IFoundation

Background

Overview

This concept is crucial for understanding India's federal structure, resource management, economic development, and the potential for inter-governmental disputes. It touches upon constitutional law, public finance, and environmental governance, making it a recurring theme in UPSC examinations.

Mineral governance in India operates under a federal structure, where both the Union and State governments have defined roles. The Constitution delineates powers regarding mines and mineral development, often leading to complex interactions and potential for disputes over resource control, revenue sharing, and regulatory authority.

Phase IIStatic core

Facts & tables

Key facts

Constitutional Basis

Entry 23 of the State List grants states power over mines and mineral development, subject to Entry 54 of the Union List, which allows the Union Parliament to regulate mines and mineral development in the public interest.

Primary Legislation

The Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act), enacted by Parliament under Entry 54, is the principal law governing mineral sector regulation in India.

Ownership vs. Regulation

States are the owners of minerals located within their boundaries, but the Centre holds significant regulatory power, especially for major minerals, impacting policy, licensing, and revenue frameworks.

Revenue Sharing

Royalties and other levies on minerals are a significant source of revenue for states, but the rates and sharing mechanisms are often a point of contention between the Centre and states.

Reference table

Centre vs. State Roles in Mineral Governance

AspectUnion Government RoleState Government Role
Legislation & PolicyFormulates national mineral policy, enacts MMDR ActImplements central laws, frames state-specific rules
Mineral OwnershipOwns offshore mineralsOwns onshore minerals within state territory
Granting LeasesRegulates major mineral auctions/leasesGrants mining leases for minor minerals, processes major mineral leases as per central law
RevenueReceives taxes, determines royalty rates for major mineralsReceives royalties, dead rent, and other levies from mining

Reference table

Static syllabus anchors

TypeReference
Conceptual areaIndian Polity & Governance
Conceptual areaFederal Structure & Centre-State Relations

Reference table

Institutions & roles

BodyRole
Ministry of Mines (Union)Formulates policy, regulates major minerals
State Mining Departments/DirectoratesAdministers mining leases, collects revenue
Geological Survey of India (GSI)Mineral exploration and assessment
Phase IIIExam lens

Prelims angle

Overview

Prelims angle: Multi-statement analysis

Prelims angle: Conceptual understanding

Quick revision

  • Constitutional basis: Entry 23 (State List) and Entry 54 (Union List).
  • MMDR Act, 1957: Central law regulating mineral development.
  • States own minerals; Centre regulates major minerals in public interest.
  • Revenue from mining (royalties) is a major source for states, often a point of dispute.
  • Recent amendments aim to streamline auction processes and boost domestic production.

Elimination traps

Constitutional vs statutory — Distinguish between the constitutional division of powers (Entries 23, 54) and the statutory framework (MMDR Act) derived from it. The MMDR Act is a central law, but states also have powers to make rules for minor minerals.

Check if created by Constitution or by Parliament.

High-confidence PYQs

2025Multi-statement analysis, Conceptual understanding

Consider the following subjects under the Constitution of India: I. List I–Union List, in the Seventh Schedule II. Extent of the executive power of a State ...

Indian PolityOpen question

Consider the following statements: Statement I: In India, State Governments have no power for making rules for grant of concessions in respect of extraction...

Indian PolityOpen question

Consider the following statements: I. The Constitution of India explicitly mentions that in certain spheres the Governor of a State acts in his/her own disc...

Indian PolityOpen question
2025Multi-statement analysis, Factual recall

Consider the following subjects under the Constitution of India: I. List I–Union List, in the Seventh Schedule II. Extent of the executive power of a State ...

Indian PolityOpen question

Consider the following statements: Statement I: In India, State Governments have no power for making rules for grant of concessions in respect of extraction...

Indian PolityOpen question

Consider the following statements: I. The Constitution of India explicitly mentions that in certain spheres the Governor of a State acts in his/her own disc...

Indian PolityOpen question
2025Statement-based questions, Conceptual understanding

Consider the following subjects under the Constitution of India: I. List I–Union List, in the Seventh Schedule II. Extent of the executive power of a State ...

Indian PolityOpen question

Consider the following statements: Statement I: In India, State Governments have no power for making rules for grant of concessions in respect of extraction...

Indian PolityOpen question

Consider the following statements: I. The Constitution of India explicitly mentions that in certain spheres the Governor of a State acts in his/her own disc...

Indian PolityOpen question
2024Statement-based questions, Factual recall

With reference to the Government of India Act, 1935, consider the following statements: 1. It provided for the establishment of an All India Federation base...

Modern HistoryOpen question
2023Statement-based questions, Conceptual understanding

Consider the following statements: Statement-I: In India, prisons are managed by State Governments with their own rules and regulations for the day-to-day a...

Indian PolityOpen question
2019Multi-statement analysis, Factual recall

With reference to the management of minor minerals in India consider the following statements: 1. Sand is a ‘minor mineral’ according to the prevailing law ...

Indian PolityOpen question
2018Multi-statement analysis, Factual recall

Consider the following statements: 1. In India, State Governments do not have the power to auction non-coal mines. 2. Andhra Pradesh and Jharkhand do not h...

GeographyOpen question
2016Factual recall, Institutional roles and functions

The Parliament of India acquires the power to legislate on any item in the State List in the national interest if a resolution to that effect is passed by the -

Indian PolityOpen question

Topic timeline

Indian Polity & GovernanceFederal Structure & Centre-State Relations
Prelims 2016· Factual recall, Institutional roles and functions

The Parliament of India acquires the power to legislate on any item in the State List in the national interest if a resolution to that effect is passed by the -

Open question
Prelims 2018· Multi-statement analysis, Factual recall

Consider the following statements: 1. In India, State Governments do not have the power to auction non-coal mines. 2. Andhra Pradesh and Jharkhand do not h...

Open question
Prelims 2019· Multi-statement analysis, Factual recall

With reference to the management of minor minerals in India consider the following statements: 1. Sand is a ‘minor mineral’ according to the prevailing law ...

Open question
Prelims 2023· Statement-based questions, Conceptual understanding

Consider the following statements: Statement-I: In India, prisons are managed by State Governments with their own rules and regulations for the day-to-day a...

Open question
Prelims 2024· Statement-based questions, Factual recall

With reference to the Government of India Act, 1935, consider the following statements: 1. It provided for the establishment of an All India Federation base...

Open question
Prelims 2025· Multi-statement analysis, Conceptual understanding

Consider the following subjects under the Constitution of India: I. List I–Union List, in the Seventh Schedule II. Extent of the executive power of a State ...

Open question

Consider the following statements: Statement I: In India, State Governments have no power for making rules for grant of concessions in respect of extraction...

Open question

Consider the following statements: I. The Constitution of India explicitly mentions that in certain spheres the Governor of a State acts in his/her own disc...

Open question
Prelims 2025· Multi-statement analysis, Factual recall

Consider the following subjects under the Constitution of India: I. List I–Union List, in the Seventh Schedule II. Extent of the executive power of a State ...

Open question

Consider the following statements: Statement I: In India, State Governments have no power for making rules for grant of concessions in respect of extraction...

Open question

Consider the following statements: I. The Constitution of India explicitly mentions that in certain spheres the Governor of a State acts in his/her own disc...

Open question
Prelims 2025· Statement-based questions, Conceptual understanding

Consider the following subjects under the Constitution of India: I. List I–Union List, in the Seventh Schedule II. Extent of the executive power of a State ...

Open question

Consider the following statements: Statement I: In India, State Governments have no power for making rules for grant of concessions in respect of extraction...

Open question

Consider the following statements: I. The Constitution of India explicitly mentions that in certain spheres the Governor of a State acts in his/her own disc...

Open question

On mines and minerals, Centre-state compromise is in tatters

27 Aug 2026 · Mineral governance in India is a prime example of cooperative and competitive federalism, with constitutional provisions (Entries 23 & 54) and the MMDR Act defining the shared responsibilities and potential friction points between the Centre and states over mineral resources, regulation, and revenue.

Read article

Related topics

Current topic

Mineral Governance and Federalism

Often confused with

Finance Commission and Fiscal Federalism in India

Open notes

Practice writing on this topic

UPSC has asked 8 linked questions on Mineral Governance and Federalism in Mains. Write an answer to one — and get it evaluated.

See Mains PYQsEvaluate an answer

UPSC Prelims PYQs on Mineral Governance and Federalism

Practice official previous year questions asked by UPSC related to this concept.

Consider the following subjects under the Constitution of India: I. List I–Union List, in the Seventh Schedule II. Extent of the executive power of a State ...

2025·Indian Polity
Solve

Consider the following statements: Statement I: In India, State Governments have no power for making rules for grant of concessions in respect of extraction...

2025·Indian Polity
Solve

With reference to the management of minor minerals in India consider the following statements: 1. Sand is a ‘minor mineral’ according to the prevailing law ...

2019·Indian Polity
Solve

Consider the following statements: Statement-I: In India, prisons are managed by State Governments with their own rules and regulations for the day-to-day a...

2023·Indian Polity
Solve

With reference to the Government of India Act, 1935, consider the following statements: 1. It provided for the establishment of an All India Federation base...

2024·Modern History
Solve

Consider the following statements: 1. In India, State Governments do not have the power to auction non-coal mines. 2. Andhra Pradesh and Jharkhand do not h...

2018·Geography
Solve

The Parliament of India acquires the power to legislate on any item in the State List in the national interest if a resolution to that effect is passed by the -

2016·Indian Polity
Solve

Consider the following statements: I. The Constitution of India explicitly mentions that in certain spheres the Governor of a State acts in his/her own disc...

2025·Indian Polity
Solve

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