Staff Recall, Magnet Export Curbs: Beijing Targets Indian Manufacturing
China's strategy to hinder India's manufacturing includes recalling workers, banning rare earth magnet exports, and delaying machinery supplies.
In a multi-pronged strategy, China is trying to stifle India's ambition to become a global manufacturing hub, which is giving a substitute for global tech companies other than the dragon itself. Recalling its workers from Indian soil, banning the export of rare earth magnets, and delaying the supply of critical machinery are little pawns of a big chess game. Unfortunately, it will impact India's manufacturing sector.
The production of iPhones is expected to be impacted at Foxconn's factories in Tamil Nadu and Karnataka after Chinese workers were asked to come back China. The move is anticipated to disrupt the entire production of Apple's iPhones.
According to a report by The Times of India (TOI), Chinese engineers and specialists, though fewer than 1% of the workforce, play a crucial role in maintaining production and quality standards at factories like Foxconn in Tamil Nadu and Karnataka.
It comes as a big setback for Apple which is planning to double down its iPhone manufacturing in India and export from India to US and other countries.
The situation, as per TOI, is not limited to Foxconn alone. Top Chinese smartphone makers like Oppo and Vivo, which have sizable manufacturing facilities in India, are also facing operational strain.
'While the companies have limited Chinese officials in India, they are worried about 'what more' can follow after this step," TOI quoted another source as saying.
The bottleneck began in April, when China, which processes more than 90% of the world's rare earth magnets, introduced stricter export controls. Under the new rules, exporters must obtain government licenses and detailed end-use certificates from buyers before shipping.
India imported 460 tons of rare earth magnets in FY24 — virtually all from China — and planned to import 700 tons this year. Their relatively low value belies their critical function.
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First Published:
July 03, 2025, 09:13 IST
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