India’s mining sector has been steadily expanding, supported by rising infrastructure activity, growth in automobile manufacturing, and sustained demand from the power and cement industries. In recent years, the rapid growth of electric vehicles (EVs) and battery storage systems has further increased the demand for a wider range of minerals.
Several important trends are shaping the mining sector. There has been a clear rise in the use of advanced technologies to improve efficiency, productivity and safety. Technologies such as internet of things, artificial intelligence and machine learning are being used for predictive maintenance, real-time asset monitoring and data-driven decision-making. Automated equipment is becoming more common, and drones are being widely used for surveying and monitoring operations.
There is also a growing focus on sustainability, with mining companies increasing the use of renewable energy at sites and gradually electrifying equipment. In addition, value addition and downstream integration are gaining importance, as companies invest in beneficiation and processing facilities to enhance output quality and capture greater value from extracted minerals.
Market size and growth
India mines over 95 minerals, including 4 fuel minerals, 10 metallic, 23 non-metallic, 3 atomic and 55 minor minerals, such as construction and building materials. These are extracted from an extensive network of around 2,045 operational mines. India holds significant reserves of iron ore, coal, bauxite and zinc, among other resources, accounting for roughly 20 per cent of global reserves in certain categories. It also produces key critical minerals such as graphite, phosphorite, rare earth elements, titanium-bearing minerals and zirconium-bearing minerals. In addition, smaller quantities of tin, nickel, cobalt, cadmium, vanadium, platinum group elements, lithium, selenium and indium are produced domestically.
Despite this resource base, mining contributes around 2 per cent to India’s GDP. However, its indirect impact on the economy is significant due to strong linkages with manufacturing and allied industries. Overall, mining accounts for about 8 per cent of India’s total industrial output. The sector is geographically concentrated, with the top five states – Assam, Chhattisgarh, Gujarat, Maharashtra and Odisha – contributing nearly 60 per cent to the total mining gross state value addition (GSVA).
India ranks as the world’s second largest producer of aluminium, among the top 10 producers of refined copper, and is the third largest producer of iron ore globally. Production trends of other key minerals have been demonstrated in the accompanying tables.
Policy backing creates a fertile ground for expansive and responsible mining 
Policy initiatives have led to transformative changes in coal mining. The launch of commercial coal mining in 2020 has added significantly to the country’s coal production – a total of 104 blocks have been auctioned since. Meanwhile, the introduction of outsourcing models such as mine developers and operators (MDOs) has led to more private engagement. The Ministry of Coal has recently revised the Mining Plan Guidelines to introduce
stringent measures for optimising coal extraction and promoting responsible mining practices.
In 2015, the Mines and Minerals (Development and Regulation) Amendment Act was enacted to bring structural reforms to India’s mineral sector. It introduced mandatory auctions to enhance transparency in mineral allocation, established the District Mineral Foundation to promote the welfare of mining-affected communities, created the National Mineral Exploration Trust (NMET) to strengthen exploration activities, and imposed stricter penalties to curb illegal mining.
The act was subsequently amended in 2016 and 2020 to enable the transfer of leases for certain non-auctioned captive mines and to address the large-scale expiry of mining leases in March 2020. Thereafter, further amendments were carried out in 2021, 2023 and 2025 to refine the regulatory framework. Most recently, the Mineral Laws (Amendment) Act, 2025, introduced key provisions, including the inclusion of additional minerals in existing mining leases, removal of the 50 per cent cap on the sale of surplus minerals from captive mines, inclusion of contiguous areas for deep-seated minerals within mining leases, establishment of an authority to register and regulate mineral exchanges, and expansion of the scope of the NMET.
In fact, now, the concept of responsible mining is taking centre stage. Sustainable practices, welfare and safety of workers and communities, minimal environmental impact, and ecosystem preservation are emerging as key priorities for long-term viability. The demand for new minerals, particularly those critical for India’s energy transition, is on the rise. The Ministry of Mines has auctioned a total of 22 blocks of critical and strategic minerals so far, which include minerals essential for green technologies and EVs. In the ongoing Tranche IV auctions, blocks of tungsten and cobalt have been offered, as these minerals are essential for high-tech, defence and energy storage sectors. Tranche IV also marked the induction of the Northeast into India’s mineral auction landscape, with four maiden blocks auctioned.
Driven by India’s clean energy transition, minerals such as lithium, cobalt and rare earth have moved to the centre of industrial strategy. Out of the 30 identified critical minerals by the Ministry of Mines, India is 100 per cent import dependent for 10. The centre accordingly launched the National Critical Mineral Mission in January 2025. In addition, about 34 critical minerals have been successfully auctioned. In February 2025, the Ministry of Mines classified barytes, felspar, mica and quartz as major minerals since they are an important source of many critical minerals and can play a vital role in the energy transition, space technologies, etc.
The Geological Survey of India (GSI) has been assigned 1,200 exploration projects for 2024-25 to 2030-31. To strengthen the domestic exploration of critical minerals, Rs 40 billion has been allocated to GSI and Rs 30 billion to the NMET. GSI has identified 0.68 million square km as areas with “obvious geological potential”. However, around 40 per cent of this falls under “no-go” zones due to restrictions, leaving about 0.41 million square km available. So far, 0.23 million square km has already been covered. Under the National Geophysical Mapping Programme, GSI has mapped 1.68 million square km. Through the National Aero-Geophysical Mapping Programme, surveys across seven blocks have led to the identification of 322 anomaly zones. In addition, GSI has mapped around 2.04 million square km within India’s Exclusive Economic Zone. Under the National Geochemical Mapping Programme, 0.21 million square km in priority areas has been completed to identify zones with abnormal elemental concentrations.
Moreover, between April and September 2025, Mineral Exploration and Consultancy Limited (MECL) completed 208,654 metres of exploratory drilling, marking a 5.72 per cent increase compared to 197,368 metres during the same period in 2024-25. In 2024-25, MECL achieved 0.45 million metres of drilling. During this period, MECL worked on 23 projects related to critical minerals, 16 for coal and lignite, eight for base and precious metals, five for bulk minerals, and one for gemstones.
Additionally, the NMET has funded 195 critical mineral projects through various exploration agencies. Further, the National Mineral Exploration and Development Trust sanctioned 62 critical mineral exploration projects in 2024-25 and an additional 36 in 2025-26.
Looking ahead
The mining sector’s contribution to India’s GDP has been around 2 per cent in the past few years, as compared to countries like Australia and South Africa, where it remained between 7.5 per cent and 12 per cent. But its indirect economic impact has been substantial owing to linkages with the manufacturing sector. Overall, it contributes about 8 per cent to the total industrial output. Mining activity is highly concentrated in the top five states, that is, Assam, Chhattisgarh, Gujarat, Maharashtra and Odisha, accounting for about 60 per cent of the all-state mining GSVA.
Going forward, the government plans to double the mining sector’s contribution to the country’s GDP to 5 per cent by 2030. Growth will be driven by expansion in coal and iron ore mining capacities, as well as strategic investments in the exploration of new and critical minerals.
