The Punjab government has approved sweeping amendments to its Minor Mineral Policy, signalling a major reset of the state’s mining framework after years of shortages, illegal extraction and regulatory bottlenecks. The reforms, cleared by the Cabinet, aim to expand legal mining supply, curb corruption, lower construction material prices and raise state revenues. Officials say the changes are intended to dismantle monopolistic practices and bring transparency to a sector long plagued by unregulated activity and limited authorised mining sites.
Mining Shortages, Illegal Supply & Policy Shift
For years, Punjab’s mining sector has operated under severe constraints, with only around 35 authorised mines meeting the state’s demand for sand, gravel and construction material. This gap led to widespread illegal mining and unregulated supply chains, particularly for infrastructure and housing projects.
The revised policy marks a strategic shift. Instead of tolerating illegal operations, the government has opted to expand the legal mining ecosystem by encouraging operators and landowners to disclose activity, complete approvals and function within a regulated framework. Mining, officials said, will continue, but only through documented and legally sanctioned channels.
Mines and Geology Minister Barinder Kumar Goyal said the move to transparent online auctions and expanded legal categories was aimed at protecting state revenue while ensuring fair access for genuine operators.
New Mining Categories To Expand Supply
A key feature of the reforms is the introduction of Crusher Mining Sites (CRMS). Under this model, crusher owners who own land with gravel deposits can obtain leases to mine material exclusively for their own use. Previously, they were dependent on limited commercial sites or costly inter-state supply.
In sand mining, Landowner Mining Sites (LMS) have been introduced alongside Commercial and Public Mining Sites. The change allows landowners to mine sand from their own land, either directly or through authorised operators, on payment of royalty. Officials say this will expand legal supply, reduce prices and prevent concentration of control in a few hands.
Faster Clearances & Auction Reforms
The policy also addresses long delays in environmental and mining approvals. Certification processes that earlier took up to nine months have been placed on a parallel, time-bound track without altering regulatory requirements.
The government has received 290 applications under the new CRMS and LMS categories, with 26 Letters of Intent already issued. More than 200 potential mining sites have been identified, with most expected to become operational between December 2025 and March 2026.
In parallel, Punjab has resumed mining auctions after three years, auctioning 29 sites online and generating Rs 11.61 crore in Phase One. The Cabinet has approved a shift to price-based bidding, longer lease tenures and stricter payment rules to prevent speculative holding and revenue leakage.
Source
