The Electronic Industries Association of India (ELCINA) has sounded the alarm over the loss of more than 21,000 jobs in India following China’s recent restrictions on the export of rare earth elements critical to the electronics sector. The organization has urged the central government to take immediate steps to mitigate the impact and reduce India’s growing dependence on Chinese imports.
In April 2025, China imposed stringent licensing requirements for the export of rare earth elements terbium and dysprosium—key raw materials used in manufacturing neodymium iron boron (NdFeB) magnets, essential for high-performance electronic products like speakers, hearables, and wearables.
According to ELCINA, the restrictions have disrupted global supply chains, forcing many Indian manufacturers to import fully assembled speaker modules from China instead of building them domestically. This shift has led to a sharp decline in local production, placing 5,000 to 6,000 direct jobs and an additional 15,000 indirect jobs at risk—particularly in manufacturing hubs like Noida and parts of South India.
"About 90% of the NdFeB magnets used in India are sourced from China," the ELCINA report states. “With the new restrictions, India’s dependence on finished goods has increased significantly, putting domestic electronics manufacturing in a state of crisis.”
The report further notes that rare earth magnets sourced from Japan, the European Union, and the United States are not a feasible alternative due to threefold higher costs and limited production capacity in those regions.
While the audio electronics sector is under immediate threat, some other industries are cautiously optimistic. Arjun Bajaj, Director of Videotex, a major TV manufacturing firm, commented, “Magnets used in speakers are also crucial for the television industry. However, we are in constant coordination with our suppliers to ensure a smooth supply chain. As of now, the impact on TV production is expected to be minimal.”
To address the looming crisis, ELCINA has demanded the urgent implementation of policies to promote domestic production of rare earth components and diversification of import sources. The association has also called on the government to reduce India’s over-reliance on Chinese imports, a sentiment gaining strong traction in both industry and policy circles.
As geopolitical tensions affect global trade flows, India’s electronics industry now stands at a critical juncture—one that may determine the country’s future role in global manufacturing.