Pradhan Mantri Khanij Kshetra Kalyan Yojana (PMKKKY)

Background and Purpose

Mining activities, while important for economic growth, create serious social and environmental challenges in the areas where they are carried out. Villages near mines often face displacement, loss of livelihood, health hazards, and ecological damage.

👉 To address this, the Government of India launched PMKKKY in 2015, under the Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act).
The scheme works through District Mineral Foundations (DMFs), which are non-profit trusts set up by State Governments in mining-affected districts.

Purpose in one line:
To ensure that people and areas affected by mining get long-term development, welfare, and livelihood support.

Beneficiaries

• Directly affected areas → Within 15 km radius of the mine (decided by State).
• Indirectly affected areas → Within 25 km radius of the mine.
• Affected People → Includes displaced families under the Land Acquisition Act, 2013 and any other groups identified by the Gram Sabha.

Thus, the scheme covers not just land-losers but also wider communities impacted by mining.

Objectives

The scheme has three main objectives:

1. Development and Welfare → Run projects for health, education, women and child welfare, etc.
2. Minimising Mining Impacts → Control environmental damage, pollution, and health hazards.
3. Sustainable Livelihoods → Ensure people have long-term income sources even after mining stops.

Salient Features

(A) District Mineral Foundation (DMF)

• Chaired by the District Magistrate / Deputy Commissioner / Collector.
• Mining companies contribute 10% or 30% of royalty (depending on lease date) to DMFs.
• Maintains updated list of affected people and areas.

(B) Utilisation of Funds

• High Priority Sectors (70% minimum):
  • Drinking water, health care, education, women & child welfare, sanitation, housing, environment protection, agriculture, skill development, livelihood generation.
• Other Priority Sectors (up to 30%):
  • Roads, irrigation, energy, watershed development, etc.

⏩ At least 70% of funds must go to directly affected areas.

(C) Endowment Fund

• Districts with collection above ₹10 crore annually must set aside 10% of receipts in an endowment fund.
• This fund is for livelihood generation after mining activities end.
• Can be invested in government bonds, securities, FDs, etc.

(D) Project Management Unit (PMU)

• If DMF collects more than ₹50 crore annually → must set up a PMU for planning, technical support, monitoring, and accounting.

(E) Direct Benefit Transfer (DBT)

• All fund transfers to agencies and beneficiaries must be through DBT into bank accounts.

(F) Planning Mechanism

1. Baseline Survey → Assess needs of local people.
2. Five-Year Perspective Plan → Long-term strategy.
3. Annual Plans → Short-term plans based on 5-year goals.
4. Gram Sabha involvement → For needs assessment and monitoring.

Convergence of Schemes

PMKKKY is not meant to work in isolation.

• DMF funds must converge with State and Central schemes, including Aspirational Districts Programme.
• Activities under “Polluter Pays Principle” (like cleaning pollution caused by mining companies) should not be financed by PMKKKY—those costs should be borne by companies themselves.

Provisions for Transparency & Accountability

To avoid misuse of funds, PMKKKY has strong transparency measures:

1. Public Disclosure
   • Lists of affected areas, people, perspective plans, and endowment fund details must be uploaded on DMF websites.
2. RTI Act, 2005
   • Voluntary disclosures encouraged under RTI.
3. Online Portal
   • Central Government to set up a digital platform for project approvals, fund release, and monitoring.
4. Audit
   • Accounts of DMFs to be audited by CAG and Chartered Accountants.
   • Reports must be made public.

Constitutional & Legal Backing (for Scheduled Areas)

Utilisation of PMKKKY funds in Scheduled Areas must comply with:

• Article 244 with Schedule V & VI of Constitution.
• PESA Act, 1996 (empowers Gram Sabhas in Scheduled Areas).
• Forest Rights Act, 2006 (protects rights of tribal and forest dwellers).

Significance

• Creates extra-budgetary resources for States.
• Helps achieve Sustainable Development Goals (SDGs) in mining areas.
• Empowers Gram Sabhas and ensures inclusive growth for marginalised communities.

✅ In summary: PMKKKY is a unique scheme where mining profits are ploughed back into mining-affected districts. It ensures that while companies earn profits from minerals, the local communities and environment are not left behind.