Odisha Chief Minister Mohan Charan Majhi on Friday, June 5, 2026, announced a revamped District Mineral Foundation (DMF) distribution system, promising transparent, equitable and just allocation of mining royalty funds to both directly and indirectly affected communities across the state's mineral-rich districts.

Posting in Odia on X, CM Majhi declared: 'The new DMF distribution system has brought a big change in development. Funds will now be distributed transparently, equally and justly among the directly and indirectly affected people of mining-impacted areas.' He added that strengthening inter-district coordination to ensure every benefit of mineral progress reaches people directly is 'the core objective of our government,' and that every mining zone will now become 'a true centre of development, modern facilities and prosperity.'

Context

The District Mineral Foundation is a statutory trust established in every mining district under the Mines and Minerals (Development and Regulation) Amendment Act, 2015. Mining companies are required to contribute a share of royalties into the DMF, which is then meant to be spent on welfare and infrastructure for communities living in and around mine-affected areas. Odisha is among India's most mineral-rich states, with major iron ore, bauxite and coal operations concentrated in districts such as Keonjhar, Sundargarh and Mayurbhanj.

Chief Minister Majhi, a BJP leader who assumed office in June 2024 following the state assembly elections, has positioned mining governance reform as a flagship priority. His announcement signals a significant policy recalibration in how the state channels mineral revenues back to affected populations.

Policy Backdrop

Since the 2015 MMDR amendment, mineral-bearing states across India have repeatedly revised DMF rules to address documented problems — including under-utilisation of funds, elite capture and weak coordination between districts. Odisha governments have issued multiple DMF guidelines and grievance redressal mechanisms over the years, directing resources toward infrastructure, health and livelihood projects in mining zones.

The new system emphasised by CM Majhi specifically addresses inter-district coordination, a persistent structural gap. Previously, funds collected in one district did not always flow equitably to communities in adjacent or indirectly affected districts, leaving large populations without adequate compensation for environmental and social disruption caused by nearby mining activity.

Stakeholders and Impact

The primary beneficiaries of the revised DMF framework are the mining-affected communities of Odisha — tribal populations, farmers, and workers in districts that host or border active mining operations. These communities have historically borne the brunt of displacement, pollution and infrastructure strain while receiving an uneven share of royalty-funded development.

District administrations will also be central to implementation, as the new system reportedly strengthens inter-district coordination mechanisms. A more rules-based, transparent distribution formula is expected to reduce discretionary allocation and make fund utilisation more accountable to local populations.

What's Next

Observers will watch for the publication of revised DMF operational guidelines, district-level fund utilisation reports and any state assembly debate on implementation timelines. The credibility of the new system will ultimately be judged by how swiftly and equitably funds reach ground-level projects in Keonjhar, Sundargarh, Mayurbhanj and other mining districts.

If the revamped framework delivers on its stated goals of transparency and inter-district equity, it could serve as a model for other mineral-rich states grappling with similar DMF governance challenges — and reinforce CM Majhi's broader pitch that Odisha's mineral wealth must translate into visible, on-the-ground prosperity for the communities closest to the mines.