Despite differences Jhagra backs mines bill, suggests key reforms

PESHAWAR: Despite serious differences with CM Ali Amin Gandapur, former provincial minister Taimur Khan Jhagra has principally supported the Mines and Minerals Bill 2025 but urged to change a few clauses for clarity.

He said it as a major legislative effort that deserves input from across the board, including opposition parties and stakeholders. Jhagra made it clear that his intention is not to question the motives of the KP government or the officers involved. He specifically praised the credibility of officials such as the DG Mines, Secretary Mines, and the Chief Secretary.

Jhagra noted while the bill is a positive step, no legislation of such scope can be without room for improvement. In that context, he offered his recommendations in a clause-wise manner.

He pointed out that up to 19 references in the act involve non-binding advice from the Federal Minerals Wing. According to him, all such references should be removed as they serve no practical purpose and have historically been open to misuse. He argued that since the advice is non-binding, there is no need for it to be codified in the legislation.

Regarding clauses 4(2a) and 4(2b), Jhagra raised the issue of requiring the DG and ADG of the Directorate General to be qualified mining engineers or geologists. He observed that these are largely administrative positions, and such qualifications should not be mandatory. Under the current draft, he noted, the sitting DG Mines would no longer be eligible.

On clauses 3 and 4, relating to the department and the Directorate General, he suggested a structural reform, potentially converting the body into a company. He said the new bill risks reinforcing a structure that, according to the federal government itself, has not delivered effectively in the past.

Clauses 5 and 6, which deal with the licensing authority, were addressed with the suggestion that the committee should include at least two to three market experts with knowledge of investment and contracting, rather than comprising only public sector officials.

He repeated that references in clauses 6(1i), 6(2c), and clause 7 regarding the mining register, which mention the advice of the Federal Minerals Wing, are redundant and should be removed.

In clause 9, which covers the Mining Cadaster System, Jhagra proposed outsourcing the management to market-based IT professionals to ensure effectiveness and transparency.

While he acknowledged the importance of clauses 11 and 12 related to the auction committee, he said it remains unclear how the bill ensures transparency in the auction process.

Clauses 13 to 15 regarding the Exploration Promotion Division were described as a good step. However, he suggested that a plan for proper staffing and operational capability is essential.

On clauses 16 to 18, concerning the district mining committees, Jhagra questioned whether the current structure is effective for dispute resolution and asked what improvements are being proposed.

Clause 19, which calls for the establishment of the Minerals Investment Facilitation Authority (MIFA), received detailed comments. Jhagra proposed that the authority should explicitly include at least three experts from the private sector. He also pointed out an apparent oversight: while advisers or special assistants for finance, environment, law, and industries are included, the Minerals Adviser or Special Assistant is not. This, he said, should be corrected. He supported the inclusion of a federal minerals wing representative in MIFA, but only if references elsewhere to the wing are removed and other provinces agree.

Clauses 20(f), 20(g), 20(h), 20(i), and 20(k) reference the advice of the federal minerals wing to MIFA. Jhagra viewed these references as redundant, given that a federal representative would already be on the authority.

Sections 22 and 23, concerning the Appellate Tribunal, were described as potentially weak in providing a robust dispute resolution mechanism, especially for international investors. Jhagra proposed including contract law experts and consulting with investors for better design.

On the question of mineral ownership and title durations, Jhagra advised that these should be reviewed by senior party lawyers and compared with global best practices.

Section 53, which gives the federal minerals wing a role in setting application fees, was also deemed unnecessary. Similarly, section 65(c), which allows the wing to influence agreements, was questioned.

Sections 84, 86, and 89, which give the federal minerals wing input into royalty rates and rents, were flagged as potentially problematic, particularly where companies may have federal government ownership.

Section 117(2), which gives the federal minerals wing a role in reviewing the act, was also seen as unnecessary.

Regarding Schedule 1, Jhagra said the definitions of strategic minerals and rare earth minerals appear sound but recommended that they be reviewed by senior legal advisers to the party and government.

Lastly, on the creation of a minerals police force, Jhagra said it would be better to create a ring-fenced unit within the KP police, possibly through special recruitment, rather than setting up a new force.