Digging Deeper into ESG: The New Legal Bedrock of India’s Mining Industry (August 2025)

Posted On - 2 September, 2025 • By - Jidesh Kumar

Environmental Pillar: Forest Conservation & Ecology

Forest (Conservation) Amendment Act, 2023

  • In 2023, Parliament amended the Forest (Conservation) Act, 1980, introducing exemptions for certain forest lands and activities from statutory protection shifting the regime from conservation to development-facilitating intent. Critics view this as a weakening of ecological safeguards, especially for tribal rights and protected areas.
  • In a landmark case involving Aravali land, Manav Rachna University in Haryana benefited from the amended Act. The Ministry applied 2023 norms, which calculate penal interest from the date of issue of demand not from the date of violation reducing the NPV-based fine by about 60%. Environmentalists condemned the move, arguing it sets a dangerous precedent for encroachment.
  • Additionally, Haryana’s delayed compliance with Supreme Court directives (from March 2025) to define and map forests—including the Aravalis—has been criticized as deliberate noncompliance. Expert panels stalled due to failure to finalize the “forest” definition, with courts revisiting the issue in September 2025.
  • Meanwhile, Maharashtra has acted to comply with SC mandates by forming committees to produce district-wise reports and GIS mapping of forest land, in alignment with the Van Sanrakshan Evam Samvardhan Rules, 2023 and Godavarman principles.

Supreme Court & Enforcement

The Supreme Court continues reinforcing its stewardship in forest governance—from the Godavarman (1996) and Lafarge (2011) rulings to SC directives in 2025 requiring states to map forest lands beyond official records.

Special Investigation Teams (SITs)

In response to Supreme Court instructions (May 2025), Haryana has formed SITs in all districts to probe illegal transfers of reserved forest land, particularly targeting educational, industrial, and residential encroachments. These teams must submit findings and recommendations within four months to the Court

Environmental Impact Assessment & Regulatory Oversight

EIA Notification Amendments (2024)

The EIA Notification of 2006 was updated in 2024, streamlining processes such as:

  • Mandatory digital submissions via PARIVESH 2.0
  • Risk-based project categorization
  • Strengthened public participation and post-clearance monitoring
  • Compliance reporting through digital platforms
  • These changes reflect growing regulatory demands for transparency and responsiveness in mining approvals.

Socioeconomic Governance: Community Welfare & Mineral Regulations

District Mineral Foundation (DMF) & PMKKKY Schemes

Under revised guidelines in January 2024, the PMKKKY framework and District Mineral Foundation mechanisms have been realigned. Key updates include:

  • DMF guidelines updated to strengthen community development spending
  • A new “Aspirational DMF Programme” launched in July 2025 to integrate DMF efforts with broader aspirational district development in education, health, infrastructure, agriculture, and financial inclusion
  • Odisha’s DMFs manage substantial funds (₹13,786.71 crore as of March 2025), evidencing the growing role of community financing

PESA & Gram Sabha Rights

Mining in Scheduled Areas remains subject to PESA (1996) provisions, requiring Gram Sabha consent for land use—particularly for forest and mining projects. The protection of tribal and traditional rights under FRA and PESA remains a critical governance concern.

Governance & Reporting: ESG Disclosure Norms

SEBI’s ESG Reporting Mandate (BRSR Core & ERPs)

In December 2024, SEBI issued new circulars introducing:

  • Industry Standards for BRSR Core reporting, including requirements for reasonable assurance for value chain partners
  • A Master Circular for ESG Rating Providers (ERPs), prescribing guidelines for authorization, control change, and data reliability
  • These reflect significant steps in ESG transparency, affecting listed mining firms and their extended supply chains.

Mineral-Specific Regulation: Critical Minerals & Mining Conduct

MMDR Amendment & Critical Minerals

The MMDR Amendment Act, 2023, laid the foundation for critical mineral governance. As of March 2025, India has identified 24 critical minerals; auctioned blocks include 44 critical mineral blocks (8 Mineral Leases, 36 Composite Licences).

IBM Star Rating & Sustainable Mining Indicators

The Indian Bureau of Mines’ rating system rewards sustainable mining practices. While not new, its prominence continues to shape ESG compliance incentives.

Final Thoughts

By August 2025, India’s mining sector is navigating a complex legal web of ESG expectations—many of them incremental, piecemeal, or embedded in older environmental tools and reporting obligations. Amid rising global and domestic pressure, the sector shows signs of embracing compliance—but gaps remain in implementation, especially regarding forest conservation, community rights, and clarity in ESG enforcement.

Contributed by – Adnan Siddiqui