BRICS and India’s magnet question

BRICS New Delhi declaration promises value addition to resource-rich countries. The question is who will teach them to separate what they mine

Inside the 45 pages that BRICS leaders adopted in New Delhi this weekend sits a paragraph and it’s about critical minerals, and it says they should move through supply chains that are “reliable, responsible, diversified, resilient, fair, sustainable, and just”.

Seven adjectives. Then comes the part I think matters more than anything else the summit produced: the declaration says those chains should deliver benefit sharing, value addition and economic diversification in the countries that actually hold the minerals.

Value addition. Two ordinary words. I want to explain why I think they carry more weight than the headlines about tariffs and UN reform, and why India should treat them as the most useful sentence it wrote all year.

Start with the thing most people get wrong about rare earths. We discuss them as though they were oil, as though the country sitting on the deposit holds the cards. It doesn’t work that way. India has roughly 6.9 million tonnes of rare earth reserves, the third-largest in the world by the US Geological Survey’s count. And yet India produced about 2,900 tonnes in 2024, around a quarter of 1 per cent of world output, against China’s 255,000 tonnes. Owning the rock has bought us almost nothing.

The reason is not geology. It is what happens after the digging.

Here is the whole problem in one image. When you pull these minerals out of the earth, you don’t get neat little piles of neodymium here and dysprosium there. You get all seventeen of them mixed together, and they behave so much like one another that telling them apart is genuinely miserable work. Separation take sometimes several hundred cycles to pull out a single pure element. Imagine being handed a sack of grains that look identical, weigh almost the same and taste the same, and being told to sort them perfectly. Then imagine doing it at industrial scale, with tanks of solvent, enormous volumes of acid, and waste that has to go somewhere.

That is the bottleneck. Not the mine.

The sorting.

China did not become indispensable because it was lucky with rocks. It spent four decades getting good at the sorting, then built the factories that turn sorted material into metal, then alloy, then a finished magnet. Today it accounts for roughly 60 per cent of global mining, more than 85 per cent of processing and refining, and over 90 per cent of rare earth permanent magnet manufacturing. The mining number is the least impressive of the three. That tells you exactly where the power sits.

Now comes the uncomfortable part of this story, because it is not about Beijing at all.

India didn’t fail to build separation capacity because the chemistry defeated us. We didn’t build it because our own law made it nearly impossible to try. India’s rare earths sit mostly in monazite, a mineral found in our coastal beach sands. Monazite also contains thorium, typically between 4 and 12 per cent by weight, and thorium is nuclear fuel. So the Atomic Energy Act of 1962 classified monazite as a prescribed substance, placing the entire business under the Department of Atomic Energy and leaving one state company, IREL, as effectively the only entity allowed to touch it. That was sound policy in 1962. Its side effect was that for six decades no private Indian firm could build the sorting capability, because it couldn’t legally obtain the feedstock.

The government has begun to unwind this. Changes to the mining law in March 2025 opened rare earth exploration to private players. But as of the middle of this year, IREL remains the only entity legally authorised to extract and process monazite. So we have a magnet scheme inviting private companies into an industry whose raw material only one public company may lawfully handle. That is not a conspiracy. It is an unreformed law sitting beneath a new policy, and somebody should say so out loud.

Now put all of this next to the room in New Delhi. BRICS today is eleven countries. Several are resource-rich. One of them does 90 per cent of the world’s magnet manufacturing. And China takes over the chairship next. So when the declaration promises value addition to resource-rich members, we should be honest about who is in a position to grant it. A group of countries that own ore, meeting under the presidency of the country that owns the processing, is not a negotiation between equals. It is a queue.

This is not cynicism about BRICS. India has just spent a year chairing this grouping, and has one window in which the phrase it wrote into that paragraph can be given teeth.

That window has a date on it.

In November 2025, China suspended a sweeping package of export controls it had announced a month earlier, with the suspension running until 10 November 2026. That is under two months away. Understand what was and was not paused. The controls imposed in April 2025, covering elements including terbium, dysprosium and yttrium, were never suspended and remain in force, with buyers facing a review period of 45 working days. Only the wider later package is on hold.

Be precise about what expiry means, too. It is not a midnight embargo. It is the return of a licensing system in which a far larger set of transactions requires Chinese government permission, including, under the extraterritorial provisions, products manufactured outside China that contain Chinese - origin rare earth material. The International Energy Agency has estimated that full implementation could place $6.5 trillion of downstream production outside China at risk. Permission is an instrument than a ban, and a far more powerful one.

For what dependence costs in plain money, look at the price gap. In late August, dysprosium oxide in Europe traded at roughly 4.9 times the Chinese domestic price. Same element, nearly five times the price, purely because of where you happen to be standing.

To be fair, the Government has not been idle. The National Critical Mineral Mission was launched in January 2025 with an outlay of about Rs 16,300 crore. In November 2025, the Cabinet approved a Rs 7,280 crore scheme for sintered rare earth permanent magnets, targeting 6,000 tonnes a year split among five companies at 1,200 tonnes each, running seven years with a two-year gestation period built in. The 2026-27 Budget added dedicated rare earth corridors in Odisha, Keralam, Andhra Pradesh and Tamil Nadu. On 13 August, the Ministry of Heavy Industries opened twenty technical bids for those five slots, with Larsen & Toubro and Coal India among the applicants.

That is a serious policy stack. My worry is simpler. The clock built into it is longer than the clock we face. A two-year gestation means the first Indian-made magnets arrive around 2028 at the earliest. The suspension lapses in November. Those two dates are not in the same conversation.

So what would I ask for?

Three things, none of them an offtake agreement.

First, India should go into the handover and say plainly that value addition means nothing unless somebody transfers separation technology and builds joint separation capacity, and that a grouping in which one member does 90 per cent of the processing needs a written rule on technology sharing, not a sentence about fairness.

Second, fix our own law, so monazite can be mined and processed for its rare earths under regulated conditions with the thorium reserved to the state.

Third, publish a timeline, not for the first magnet but for the first tonne of separated, magnet-grade Indian oxide, because that is the number that tells us whether any of this is real.

There is a version of the next few years in which India signs friendly documents, keeps importing, and discovers in 2028 that it built five magnet factories still dependent on somebody else to sort the feedstock. A minister told Parliament last month that China accounted for more than 30 per cent of India’s rare earth element imports by volume in 2025-26. That number will not fall on its own.

We have the rock. Almost everybody has rock. What we lack is the boring, dirty, patient capability to separate one element from its near-identical twin, several hundred times over, at a price somebody will pay. Until we have that, we are a mining country writing declarations about value addition and hoping the country that already owns the value chain reads them kindly.

The author is a physicist at the University of North Carolina at Chapel Hill and a contributing opinion writer at The Wall Street Journal; Views presented are personal.