UPSC Prelims 2016 Q62: Indian Economy – Infrastructure & Industry
What is/are the purpose/purposes of 'District Mineral Foundations' in India?
1. Promoting mineral exploration activities in mineral - rich districts
2. Protecting the interests of the persons affected by mining operations
3. Authorizing State Governments to issue licences for mineral exploration
Select the correct answer
using the code given below.
- (a) 1 and 2 only
- (b) 2 only
- (c) 1 and 3 only
- (d) 1, 2 and 3
Answer: (b) 2 only
Explanation
District Mineral Foundations (DMFs)
Set up under Section 9B of the Mines and Minerals (Development and Regulation) Amendment Act, 2015.
A DMF is a non-profit trust in every district affected by mining.
| Statement | Verdict | Fact |
|---|---|---|
| 1. Promoting mineral exploration activities in mineral-rich districts | Incorrect | Exploration is funded by the National Mineral Exploration Trust |
| 2. Protecting the interests of the persons affected by mining operations | Correct | This is the sole purpose of a DMF |
| 3. Authorizing State Governments to issue licences for mineral exploration | Incorrect | Licensing is a power under the Act, not a function of DMFs |
How a DMF works:
| Feature | Detail |
|---|---|
| Funded by | Miners: 30 percent of royalty (old leases) or 10 percent (auctioned leases) |
| Spent through | Pradhan Mantri Khanij Kshetra Kalyan Yojana |
| Priority areas | Drinking water, health, education, environment |
Answer: (b) 2 only.
Why each option is right or wrong
- (a) Incorrect. Mineral exploration is not a purpose of District Mineral Foundations.
- (b) CORRECT. DMFs protect the interests of persons affected by mining operations.
- (c) Incorrect. Neither exploration nor issuing licences is a purpose of DMFs.
- (d) Incorrect. Only statement 2 is a purpose; 1 and 3 belong to other bodies.
Key point
DMF (Section 9B, MMDR Amendment Act 2015): district trust funded by miners' royalty share for the welfare of mining-affected people; spent via PMKKKY.
Remember
DMF = welfare of mining-affected people.
Common mistakes
- Confusing the DMF (welfare) with the National Mineral Exploration Trust (exploration).
- Thinking DMFs are funded by the Government; miners pay.
- Linking DMFs to the licensing of mines.
Exam tip
DMF = district welfare. NMET = national exploration. Both came from the 2015 amendment.
Sources
- Mines and Minerals (Development and Regulation) Amendment Act, 2015 — Section 9B
- Ministry of Mines — Pradhan Mantri Khanij Kshetra Kalyan Yojana guidelines