India’s Smartphone Industry Flags Informal Chinese Sanctions, Seeks Urgent Government Intervention
The companies have sought an urgent meeting with the government to discuss policy interventions that can safeguard India’s $64 billion smartphone industry.
India’s top smartphone and electronics manufacturers have raised alarm over what they describe as a pattern of informal and targeted trade restrictions imposed by China, which they claim is putting India’s booming electronics manufacturing ecosystem at risk.
The letter, penned by the India Cellular & Electronics Association (ICEA) to Ashwini Vaishnaw, Minister of Electronics and IT, and seen by NDTV Profit, informs that companies have identified three major chokepoints that are disrupting production, raising costs, and threatening India’s export competitiveness.
First, manufacturers say China has significantly restricted the export of high-precision tools and equipment used in electronics manufacturing to India over the past eight months. These include critical capital goods like heavy-duty boring machines, which are now facing near-total export bans or customs delays. Industry players warn that importing such equipment from alternate sources like Japan or South Korea is 3-4 times more expensive, directly hitting India’s cost advantage.
Second, there are growing curbs on the export of critical minerals and rare earths, which are key raw materials for smartphones and electronic devices. The letter highlights that China’s dominance over these resources creates supply vulnerabilities for Indian factories, with very few scalable or cost-effective alternatives.
Third, travel restrictions and the recall of Chinese technical personnel working in India have further complicated operations. These experts are essential for operating Chinese-origin machinery and facilitating technology transfer. Their forced exit is impacting production ramp-ups and new product development.
The companies have sought an urgent meeting with the government to discuss policy interventions that can safeguard India’s $64 billion smartphone industry and its broader ambition of becoming a global electronics hub.
They have requested targeted support to ensure supply chain continuity and cost stability, warning that recent export gains, of about $24.1 billion in FY25, are now at serious risk due to these coordinated disruptions by China.
