India has auctioned 733 mineral blocks but only 125 were operational as of August 2026, according to sectoral reviews shared by the coal and mines ministries with states. The Centre says award-to-production intervals exceed seven years for major and critical mineral blocks amid regulatory complexities. Mining contributes over ₹1.9 lakh crore annually to government exchequers, with 90% accruing to states. Concept notes flag extreme import reliance, land acquisition hurdles, uncoordinated state cesses and weak first-mile logistics as core bottlenecks.
According to m.economictimes.com, India has auctioned 733 mineral blocks across its states but only 125 were in operation as of August 2026, with the remainder stalled at various stages of clearance, according to sectoral reviews shared by the coal and mines ministries with state governments.
The concept notes, prepared ahead of the 6th national conference of chief secretaries, describe persistent “extreme domestic supply-chain vulnerabilities” driven by high import reliance and nascent deep-drilling technologies. The Centre has urged states to adopt “mission mode” coordination to strengthen energy security and economic growth.
Clearance bottlenecks stretch award-to-production timelines
The gap between auction and actual production exceeds seven years for major and critical mineral blocks, which the Centre attributes to regulatory complexities and layered clearance requirements. The mining sector contributes over ₹1.9 lakh crore annually to government exchequers, and 90% of that revenue accrues directly to states.
To close the gap, the Centre has prescribed a “complete value chain approach” built on an integrated resource-to-revenue framework, moving auctioned blocks into operation and applying waste-to-wealth principles backed by clean technologies, according to the report.
India produces more than 95 minerals, including critical minerals such as lithium and cobalt, but bottlenecks are slowing progress on both critical and minor mineral extraction. The Centre has specifically asked states to develop a framework for extracting beach sand minerals like monazite so rare earth elements become available to new-age industries.
Nine categories of ground-level challenges
The concept notes identify nine levels of challenges. For critical minerals, the main constraints are China-linked supply chain and technology dependencies. For minor minerals, the absence of mineral-specific exploration norms and standardised, GIS-enabled State Mineral Inventories has led to what the notes call “unscientific quarry block mapping” and localised environmental degradation.
As near-surface deposits deplete, operators must access deep-seated and structurally complex mineral systems covered by regolith, basalt or heavy sediments, posing serious financial and technological challenges. The notes cite domestic unavailability of commercially demonstrated technology, high capital costs for advanced equipment, investor risk aversion and limited domestic processing capacity for high-purity strategic elements.
Land acquisition remains the single largest “critical-path dependency.” Roadblocks across states include fragmented land records, disputed titles, complex compensation assessments, resistance to physical possession and rehabilitation-resettlement hurdles. The absence of pre-identified state land banks for compensatory afforestation is stalling forest clearance proposals, while law and order issues periodically halt exploration and mineral despatch.
Illegal extraction and fragmented levies add friction
Illegal extraction of sand and stone causes severe riverbed degradation and substantial royalty leakages, according to the Centre. A “plethora of uncoordinated state-level cesses,” overlapping levies, multiple sequential approvals across departments and complex regulatory compliances further slow projects.
For minor minerals, varying state concession rules, the lack of single-window portals and delayed district survey reports create administrative friction. Logistics is another weak point: gaps in first-mile connectivity, dedicated rail sidings, port linkages, stockyards and high-capacity road corridors, alongside unrationalised transit permit systems, continue to raise costs and barriers.
“Extreme domestic supply-chain vulnerabilities persist due to high import reliance and nascent deep-drilling technologies.” — Concept notes shared ahead of the 6th national conference of chief secretaries
The reviews come as global competition for critical minerals intensifies and China-linked supply chain constraints weigh on India’s ability to operationalise the bulk of its auctioned mines.
Source: m.economictimes.com
Compiled from international media by the SCI.AI editorial team.
