Sikkim Notifies Rules for State Mineral Exploration Trust and Fund

The Government of Sikkim, through its Mines and Geology Department, recently issued a significant piece of delegated legislation, the Sikkim State Mineral Exploration Trust Rules, 2025. This notification, bearing No. 04/DMG/25-26 and dated August 2, 2025, was published in the Official Gazette on Monday, August 11, 2025, and came into force on that date. The rules were promulgated in exercise of the powers conferred by clause (g) of sub-section (1A) of section 15 of the Mines and Minerals (Development and Regulation) Act, 1957, a central enactment. The core of these rules is the establishment of a dedicated state-level body, the Sikkim State Mineral Exploration Trust, along with a robust financial mechanism to support its operations. The legislation defines key terms such as "Act," "Department," "Executive Committee," "Fund," "Governing Body," and "Obvious geological potential areas," ensuring clarity in its application across the whole of Sikkim.

The newly constituted Trust is designed to oversee the planned development and exploration of mineral resources within the State. It features a two-tiered governance structure: a Governing Body and an Executive Committee. The Governing Body, chaired by the Minister-in-charge of the Mines and Geology Department, includes senior officials from the Finance, Forest and Environment, Revenue, and Planning and Development Departments, with the Secretary of the Mines and Geology Department serving as Member-Secretary. This body is tasked with laying down the broad policy framework, approving annual plans and budgets, and reviewing the Trust's overall functioning. The Executive Committee, chaired by the Secretary, Mines and Geology, comprises technical experts including representatives from the Geological Survey of India (GSI) and the Indian Bureau of Mines (IBM), along with departmental officials. This committee is responsible for the day-to-day management, administration, supervision, and monitoring of the Trust's expenditures. Both bodies are empowered to invite experts with special knowledge in mineral exploration, who may receive sitting fees but will not have voting rights.

A central feature of the rules is the establishment of the Sikkim State Mineral Exploration Trust Fund, to be managed by the Executive Committee. This fund will receive contributions from various sources, notably a mandatory payment from mining lease holders, quarry licensees, and permit holders of minor minerals. These entities are required to contribute a sum equivalent to two percent of the royalty, as specified in the Second Schedule of the Sikkim Minor Mineral Concession Rules, 2025, for any mineral removed or consumed. This payment is to be collected in advance along with royalty under a separate sub-head through e-payment. Furthermore, the State Government will transfer fifty percent of the revenue collected as penalties under Chapter VIII of the Sikkim Minor Mineral Concession Rules, 2025, to the Trust. The competent authority is made responsible for the collection and deposit of these amounts, as well as for maintaining books of accounts and providing monthly royalty databases to the Trust.

The legislative intent behind these rules is to foster a more systematic and scientifically driven approach to mineral resource management in Sikkim. The establishment of the Trust aims to address potential gaps in funding and coordinated efforts for mineral exploration, which is crucial for sustainable economic development. The legislation provided: “There shall be a Trust at the state level to be known as the Sikkim State Mineral Exploration Trust. The objective of the Trust shall be the planned development of the mineral resources and their exploration in the State.” This underscores the policy rationale to move beyond ad-hoc measures towards a structured framework for identifying, assessing, and developing the state's mineral wealth. The rules outline a comprehensive set of objectives and functions for the Trust, including preparing short, mid, and long-term vision plans, undertaking regional and detailed exploration, facilitating geophysical and geochemical surveys, and promoting sustainable mining practices. It also emphasizes capacity building for departmental personnel, research and development in mineral analysis, and the creation of a State Mineral Directory and Geo-Informatics Mineral Resource Information System. The Trust is also mandated to strengthen and upgrade the Department's laboratory facilities, provide technical and consultancy services, and assess needs for skill development in the mineral sector. The inclusion of provisions for monitoring mining activities through modern technologies like drones highlights a forward-looking approach to enforcement and oversight. The rules also detail the processes for preparing and approving annual plans and budgets, maintaining accounts, and conducting audits, ensuring financial transparency and accountability for the Trust's operations, which will follow a financial year from April 1 to March 31.

Keywords: Sikkim, Mineral Exploration Trust, Mineral Resources, Mining, Mines and Geology Department, Mineral Development, Sikkim State Mineral Exploration Trust Rules 2025, Mineral Fund, Exploration, Sustainable Mining

Geo Tags: Country: India State: Sikkim District: Not Applicable