Rare earth supply crunch: Over 21,000 jobs in India's audio electronics sector at risk due to China curbs, says Elcina report
More than 21,000 jobs in India's audio electronics sector are at risk due to China's curbs on the export of rare earth metals, industry body Elcina has said in a report shared with the government.
In April, China implemented stricter licensing rules on the export of key rare earth elements like terbium and dysprosium, which are essential for making Neodymium-Iron-Boron (NdFeB) magnets — widely used in consumer electronics such as hearables, wearables, and speakers.
The Electronics Industries Association of India (Elcina) said the move has disrupted supply chains globally and is severely affecting India's fast-growing wearables and hearables market, forcing many manufacturers to switch to importing fully assembled speaker modules from China, PTI reported.
'This creates a regressive trend — from component manufacturing back to finished good imports dependency. Over 5,000–6,000 direct jobs and 15,000 indirect jobs are at risk in speaker and audio component manufacturing, especially in Noida and South India,' Elcina noted.
India dependent on China for
NdFeB magnets
Rare earth magnets make up 5–7% of the bill of materials, and India imports nearly 100% of its NdFeB magnet requirement, with China accounting for 90% of those imports.
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Prices for Chinese magnets have surged amid tightened supply and administrative delays, while alternatives from Japan, the EU and the US are 2–3 times costlier and lack adequate capacity.
Electronics manufacturer Videotex, which produces televisions for brands such as Havells (Lloyd), Reliance (BPL, Reconnect), Toshiba, and Vijay Sales, said the situation poses challenges, but the immediate impact on TV production is expected to be limited.
'Rare earth-based magnets are critical in TV manufacturing, particularly for speakers due to their compact size and high performance. However, we are working closely with our suppliers to ensure sufficient stock for the upcoming season,' said Arjun Bajaj, Director of Videotex.
He added that Videotex is also exploring alternative magnet options like ferrite, which come with acceptable performance trade-offs, and stressed that this disruption highlights the need for long-term strategies to localise and diversify sourcing.
Elcina urges government action
Elcina has urged the government to begin government-to-government (G2G) talks with China, seek industry-specific exemptions, and boost domestic R&D and manufacturing under the electronics component manufacturing scheme.
It also recommended that the government consider a production-linked incentive (PLI) scheme for critical minerals, to reduce India's reliance on China and ensure the resilience of its electronics supply chain.
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