China’s recent restrictions on the export of key rare-earth metals have triggered serious concerns in India’s electronics manufacturing sector, putting thousands of jobs at risk. According to the Electronic Industries Association of India (ELCINA), China’s tighter export controls on critical elements like terbium and dysprosium—vital to the audio electronics and wearables industry—have disrupted global supply chains and severely impacted Indian manufacturers.
Previously, Indian companies imported these rare-earth elements from China to manufacture NdFeB (Neodymium-Iron-Boron) magnets, which are essential components in speakers, earbuds, and other electronic devices. However, with stricter licensing norms now in place, Indian firms are being forced to import fully assembled speaker modules instead of manufacturing components locally. This shift threatens the viability of domestic component production and is pushing the sector toward greater dependence on Chinese finished goods.
As a result, at least 5,000 direct jobs and 15,000 indirect jobs—particularly across southern India and the Noida region—are now at risk. The situation is further aggravated by rising prices of rare-earth magnets due to limited supply, as China currently supplies nearly 90% of India’s NdFeB magnet needs. Alternative exporting nations are either unable to meet demand or are not cost-effective.
In response, ELCINA has urged the Indian government to intervene and prioritize local production of rare-earth magnets, to safeguard jobs and promote self-reliance in electronics manufacturing.
The development serves as a wake-up call for India’s manufacturing sector to diversify its supply sources and invest in domestic capabilities to avoid future disruptions in critical supply chains.
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