Why in News?

  • The Allahabad High Court recently ruled that District Mineral Foundations (DMFs) are beneficial legislation.
  • The Court held that DMF provisions must be interpreted liberally to benefit people and areas negatively affected by mining activities.

WHAT ARE DISTRICT MINERAL FOUNDATIONS?

  • District Mineral Foundations are statutory, non-profit trusts set up by State Governments.
  • They are established in districts affected by mining-related operations.
  • Their objective is to ensure that local communities share the benefits of mineral development.

LEGAL BASIS

  • DMFs are created under Section 9B of the Mines and Minerals (Development and Regulation) Act.
  • This provision was added through the MMDR Amendment Act, 2015, which came into force on 26 March 2015.
  • The law mandates States to establish a DMF in every mining-affected district.

PURPOSE & FUNCTIONS

  • DMFs work for the welfare of people and areas affected by mining.
  • Their functions are decided by the respective State Governments.
  • They focus on reducing the social, economic, health, and environmental impacts of mining.

JURISDICTION & ADMINISTRATION

  • DMFs operate under the jurisdiction of State Governments.
  • States decide the composition, powers, and functioning of the DMF Trust.
  • Funds are spent according to an Annual Action Plan prepared by the Trustees.
FUNDING OF DMFs
  • DMFs are funded through mandatory contributions from mining lease holders.
  • Both major and minor mineral concession holders contribute to the fund.
  • The Central Government has notified the contribution rates.
Contribution Rates
  • For mining leases granted before 12 January 2015, miners contribute 30% of the royalty payable.
  • For mining leases granted after 12 January 2015, miners contribute 10% of the royalty payable.

USE OF DMF FUNDS

  • DMF funds are used for the overall development of mining-affected areas.
  • Major areas of spending include:
    • Creation of local socio-economic infrastructure,
    • Improvement of community assets and basic services,
    • Skill development and training for employment and self-employment,
    • Health, education, drinking water, and environmental protection.

PRADHAN MANTRI KHANIJ KSHETRA KALYAN YOJANA

  • The Ministry of Mines launched PMKKKY in 2015.
  • The scheme uses DMF funds for welfare and development in mining-affected regions.
Objectives of PMKKKY
  • To implement development and welfare projects in mining areas.
  • To minimise environmental, health, and social damage caused by mining.
  • To ensure long-term and sustainable livelihoods for affected communities.

FUND UTILISATION PATTERN

  • At least 60% of funds must be spent on high-priority areas such as drinking water, health, education, and environment.
  • Up to 40% of funds can be used for other priority areas like infrastructure, irrigation, energy, and watershed development.
SIGNIFICANCE OF DMFs
  • DMFs promote equitable sharing of mineral wealth.
  • They act as a tool for environmental justice and inclusive development.
  • Judicial support strengthens DMFs as a rights-based welfare mechanism rather than a mere administrative body.
CONCLUSION District Mineral Foundations are a key pillar of sustainable and people-centric mining governance in India. The Allahabad High Court’s judgment reinforces their role in protecting mining-affected communities. Effective use of DMF funds is essential for balanced regional development and social justice.