CABINET APPROVES SHIFT TO PRICE-BASED BIDDING TO RAISE REVENUE & SPEED OPERATIONS, BY SHIFTING TO TRANSPARENT ONLINE AUCTIONS, PROTECTING STATE REVENUE, CREATING LEVEL PLAYING FIELD FOR GENUINE OPERATORS, AND CURBING ILLEGAL MINING, SAYS MINISTER
Face2News/Chandigarh
Reinforcing its commitment to transparency and responsible resource management, the Punjab Government has launched fresh auctions for mining sites across the state and notified major reforms to the auction framework under the amended Punjab Minor Mineral Rules.
Speaking on the reforms, Mining and Geology Minister Barinder Kumar Goyal said, “Our government is committed to ending opacity in mining and ensuring that natural resources are used for the benefit of the people. By shifting to transparent online auctions, we are protecting state revenue, creating a level playing field for genuine operators, and curbing illegal mining.”
In Phase 1, the government has auctioned 29 new Commercial Mining Sites (CMS) through an open and competitive online bidding process. These auctions, floated in October–November, resulted in 16 successful bids and generated ₹11.61 crore in revenue. Notably, these are the first mining auctions conducted by the state in the last three years.
The Cabinet-approved reforms mark a decisive break from earlier volume-based auction systems, where bidders competed by offering to operationalise the maximum share of a site. In practice, many bidders quoted identical volumes, often 100 percent, leading to selection by draw of lots. Over time, this approach resulted in reduced revenue realisation, proliferation of non-serious bidders, limited investment commitment, and delays in operationalising mines, as environmental clearances were the government’s responsibility.
To address these systemic flaws, the Cabinet has approved a series of structural reforms aligned with best practices followed across India. Auctions will now be based on competitive price bidding, ensuring fair allocation and improved revenue outcomes. Bidders will be required to make upfront payments to demonstrate seriousness, and royalty payments will be collected in advance to ensure steady revenue flows.
Responsibility for obtaining Environmental Clearances has been shifted to bidders, a move expected to significantly reduce delays in making mines operational. Clear dead rent provisions have also been introduced to prevent speculative bidding by ensuring minimum payments even if mines are not operationalised. Additionally, lease tenures have been extended from three years to five years, providing greater stability and planning certainty to operators.
The government has clarified that while 29 sites have been auctioned in Phase 1, nearly 100 additional sites will be brought to auction in staggered phases. These reforms are expected to expand legal supply of raw materials, accelerate operational timelines, strengthen regulatory clarity, and substantially increase government revenues.
The government affirmed that the combined impact of policy amendments, CRMS/LMS introduction, and auction reforms represents a comprehensive overhaul of Punjab’s mining sector, aimed at eliminating opacity, preventing monopolies, curbing illegal mining, and ensuring that natural resources are utilised for public benefit.
The Punjab government emphasised that transparent online auctions, coupled with legalisation of mining through CRMS and LMS, are central to protecting state revenue, creating a level playing field for genuine operators, and restoring public confidence in the mining governance framework.