DISTRICT MINERAL FOUNDATION
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.
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