Punjab Expands Mining Sites To Curtail Illegal Extraction

The Punjab government announced an ambitious expansion of authorised mining operations across the state this week, unveiling plans to operationalise more than 200 new mining sites as part of a comprehensive strategy to curb illegal mineral extraction and ensure a stable, legal supply of construction raw materials. The initiative, coupled with fresh regulatory reforms and transparent auction mechanisms, targets the persistent informal mining economy that has distorted prices, eroded revenues and undermined sustainable resource management across urban and rural districts alike. 

Under the amended Punjab Minor Mineral Rules, the state has identified over 200 government-specific mining sites and received 290 proposals from crusher operators and private landowners seeking legal extraction rights. Once operational, these sites — expected to start production between December 2025 and March 2026 — should significantly widen access to sand, gravel and other minor minerals essential for housing, infrastructure and industrial projects. For years, Punjab’s construction ecosystem has grappled with supply shortages and inflated material costs due to an acute shortage of sanctioned mines and rampant illegal extraction. Analysts note this has undermined both regulatory oversight and planning certainty, forcing builders to depend on informal networks that perpetuate environmental damage and erode price transparency. Strengthening the formal mining base is expected to stabilise supply chains and align material flows with planned urban growth and infrastructure investments. 

A pivotal element of the new policy is the introduction of Crusher Mining Sites (CRMS) and Landowner Mining Sites (LMS), which empower local crusher owners and landholders to extract minor minerals legally on their properties after paying royalties. This institutional innovation aims to decentralise extraction rights, dilute monopolistic control and bring previously untapped resources into the formal economy — a shift seen as crucial to reducing illegal operations and increasing small-owner participation. Parallel to site expansion, Punjab has revamped its mining auction framework, moving from a volume-based system to transparent, price-based online bidding. In a maiden phase, the state auctioned 29 commercial mining sites, generating ₹11.61 crore in revenue and signalling stronger governance and competitive entry for genuine operators. Lease tenures have been extended to five years and environmental clearance responsibilities shifted to bidders, designed to encourage prompt operationalisation while maintaining regulatory standards. 

Mining and geology officials say these reforms represent the most comprehensive overhaul in years, targeting not only illegal extraction but also administrative opacity and revenue leakage. By synchronising site expansion, auction transparency and streamlined clearances, the government expects a more robust, equitable mineral supply that supports both small-scale builders and large infrastructure developers. Still, observers caution that effective enforcement and environmental protection will be critical to the initiative’s success. Illegal mining in Punjab has historically triggered riverbed degradation and ecosystem disruption, illustrating the environmental stakes of rapid resource extraction. Stakeholders argue that digital monitoring, community engagement and strict penalty frameworks must accompany supply expansion to safeguard long-term sustainability. 

As these new sites come online, the impact on material availability, price stability and construction timelines will be closely watched by market participants and urban planners. A well-regulated mining sector could ease input constraints for housing and transport projects, lower construction costs and bolster investor confidence — provided regulatory commitments translate into predictable, transparent operations on the ground

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Punjab Expands Mining Sites To Curtail Illegal Extraction