Punjab Cabinet Approves Historic Mining Policy Overhaul to End Monopolies

India

oi-Prakash KL

Published: Wednesday, January 7, 2026, 13:15 [IST]

In
a
decisive
move
to
transform
the
state’s
industrial
landscape,
the
Punjab
Government,
led
by
Chief
Minister
Bhagwant
Singh
Mann,
has
approved
a
series
of
historic
reforms
within
the
Punjab
Minor
Mineral
Policy.
These
amendments
are
designed
to
fundamentally
restructure
the
mining
sector
by
ensuring
a
steady
supply
of
raw
materials,
eradicating
systemic
corruption,
and
eliminating
the
long-standing
monopolies
that
have
historically
driven
up
construction
costs
for
the
general
public.

Mining
and
Geology
Minister
Barinder
Kumar
Goyal
stated
that
these
reforms
were
finalized
following
extensive
deliberations
with
stakeholders
at
various
levels.
The
primary
objective
of
the
new
policy
is
to
transition
the
state
toward
a
more
transparent,
citizen-centric
governance
model
while
simultaneously
boosting
state
revenue.

Minister
Goyal
highlighted
that
for
several
years,
Punjab’s
mining
sector
was
crippled
by
a
severe
shortage
of
authorized
sites.
With
only
approximately
35
quarries
operational
across
the
state,
the
legal
supply
of
sand
and
gravel
fell
drastically
short
of
the
demand
generated
by
massive
infrastructure
projects,
residential
construction,
and
roadworks.
This
vacuum
allowed
illegal
mining
and
unregulated
supply
chains
to
flourish.

To
address
this
structural
deficiency,
the
Punjab
Government
is
shifting
away
from
a
purely
punitive
approach
toward
a
strategic
integration
of
supply
into
the
legal
framework.
Under
the
new
guidelines,
operators
are
being
encouraged
to
declare
their
activities
and
comply
with
strict
regulatory
standards.
The
government
has
made
it
clear
that
while
mining
is
essential
for
development,
it
will
only
be
permitted
if
conducted
transparently,
legally,
and
with
all
necessary
environmental
clearances.

One
of
the
most
significant
shifts
in
the
policy
is
the
introduction
of
Crusher
Mining
Sites
(CRMS).
Previously,
the
crusher
industry
faced
a
chronic
shortage
of
raw
materials
because
auctions
were
limited
to
commercial
sites.
Even
crusher
owners
who
possessed
mineral-rich
land
were
prohibited
from
extracting
material,
forcing
them
to
rely
on
expensive
imports
from
other
states.
The
new
CRMS
framework
allows
these
owners
to
obtain
mining
leases
for
their
own
land,
which
is
expected
to
drastically
increase
the
availability
of
gravel
and
sand,
reduce
interstate
dependency,
and
lower
prices
for
end-consumers.

Furthermore,
the
government
has
introduced
Land-Owner
Mining
Sites
(LMS)
to
empower
local
farmers
and
break
the
hold
of
“mining
mafias.” In
the
past,
many
landowners
were
hesitant
to
allow
external
contractors
onto
their
property.
The
LMS
framework
now
permits
landowners
to
mine
sand
from
their
own
fields
after
paying
the
prescribed
royalty
to
the
state.
This
initiative
not
only
creates
new
entrepreneurial
opportunities
for
Punjabis
but
also
ensures
that
the
supply
of
sand
is
decentralized,
making
it
harder
for
any
single
entity
to
monopolize
the
market.

To
ensure
these
reforms
translate
into
immediate
action,
the
government
has
placed
the
approval
process
into
“Mission
Mode.” Historically,
environmental
clearances
through
the
State
Environment
Impact
Assessment
Authority
could
take
up
to
nine
months
or
even
years.
The
new
policy
streamlines
these
procedures,
allowing
for
simultaneous
clearances
to
ensure
time-bound
decision-making.
Already,
290
applications
have
been
received
under
the
new
categories,
and
over
200
additional
sites
have
been
identified
for
future
operations.
Most
of
these
new
sites
are
slated
to
become
operational
between
December
2025
and
March
2026.

Finally,
the
state
has
revamped
its
auctioning
model
to
ensure
maximum
fairness.
Moving
away
from
older
systems
prone
to
dummy
bidding
and
revenue
loss,
the
Cabinet
has
approved
a
value-based,
competitive
online
bidding
process.
Lease
periods
have
been
extended
from
three
to
five
years
to
provide
stability
for
legitimate
operators,
while
advance
royalty
payments
will
ensure
a
steady
flow
of
income
to
the
state
treasury.
By
combining
these
logistical,
legal,
and
economic
reforms,
the
Punjab
Government
aims
to
create
a
sustainable
mining
ecosystem
that
prioritizes
the
needs
of
its
citizens
and
the
integrity
of
its
natural
resources.