SYLLABUS

GS-2: Government Policies and Interventions for Development in various sectors and Issues arising out of their Design and Implementation.

Context: The Pradhan Mantri Khanij Kshetra Kalyan Yojana (PMKKKY) seeks to ensure that communities affected by mining benefit from mineral wealth through welfare initiatives, environmental protection and sustainable livelihood opportunities.

About the Pradhan Mantri Khanij Kshetra Kalyan Yojana (PMKKKY)

• It was launched on 17 September 2015 to promote the welfare and development of areas and people affected by mining-related operations.

• The scheme is implemented by District Mineral Foundations (DMFs) using funds collected from mining lease holders.

• It aims to minimise the adverse effects of mining on the environment, health and socio-economic conditions of local communities while promoting sustainable livelihoods.

• The scheme operates under the Mines and Minerals (Development and Regulation) Act, 1957, which requires States to incorporate PMKKKY provisions into their DMF rules. Revised guidelines issued in January 2024 provide an updated framework for implementing development and welfare projects.

Key Features

• District Mineral Foundations (DMFs): District Mineral Foundations are non-profit trusts established under the 2015 amendment to the Mines and Minerals (Development and Regulation) Act, 1957, to work for the benefit of people and areas affected by mining operations under the supervision of the respective State Governments.

• Funding Mechanism: Mining lease holders contribute to DMFs based on the royalty payable on minerals extracted, with contributions fixed at 30% of royalty for leases granted before 12 January 2015 and 10% for leases granted on or after that date.

• Coverage of Mining-Affected Areas: PMKKKY covers both directly affected areas, where mining and related activities occur, and indirectly affected areas, where mining causes pollution, groundwater depletion or deterioration in environmental quality; affected persons may also include families and individuals with traditional or occupational rights.

• Fund Utilisation: Under the revised framework, at least 70% of PMKKKY funds must be allocated to high-priority sectors, including drinking water, healthcare, education, environmental protection, sanitation and livelihood generation, while up to 30% may be used for infrastructure, irrigation, energy and watershed development.

• Safeguards for Vulnerable Communities: State Governments must frame DMF rules in accordance with constitutional provisions relating to Scheduled and Tribal Areas, the Panchayats (Extension to the Scheduled Areas) Act, 1996, and the Forest Rights Act, 2006, ensuring attention to the rights and needs of vulnerable communities.

Significance

• Development of Mining-Affected Areas: PMKKKY directs mining-related revenue towards essential services, infrastructure and welfare projects, helping improve living standards in affected communities.

• Large-Scale Implementation: As of July 2026, over 4.70 lakh projects worth ₹1,09,938 crore had been sanctioned, of which 2,92,156 projects had been completed. Another 78,809 projects were under execution, with committed funds of over ₹30,512 crore.

• Environmental and Livelihood Protection: The scheme supports pollution control, environmental restoration, healthcare, skill development and sustainable livelihood opportunities, helping communities address the long-term consequences of mining.

• Social Justice and Inclusive Growth: By recognising the needs of displaced families, tribal communities and people with traditional rights, PMKKKY seeks to ensure that the benefits of mineral resources reach those affected by their extraction.

Challenges

• Effective Implementation: Ensuring timely completion of sanctioned projects and efficient utilisation of DMF funds remains essential for delivering tangible benefits.

• Participatory Governance: Strengthening the involvement of Gram Sabhas and local communities can improve transparency and ensure that projects address genuine local needs.

• Targeted Fund Utilisation: Ensuring that resources reach genuinely affected people and prioritising their most pressing welfare and development needs remain important challenges.

• Long-Term Sustainability: Balancing mining-led economic growth with environmental protection and sustainable livelihoods after mining activities cease requires continued policy attention.