Mounting supply woes, stalled shipments, and job risks; India’s electronics industry braces for disruption as import curbs and Chinese restrictions tighten the squeeze on growth.
The Indian government has imposed fresh import restrictions on gold compounds; critical raw materials used in producing semiconductors, printed circuit boards, and connectors, just as manufacturers were already grappling with China’s export curbs on rare earth magnets.
According to a report by the Press Trust of India (PTI), this poses a significant obstacle to the country’s goal of becoming a global electronics manufacturing hub.
The Directorate General of Foreign Trade (DGFT), in an order issued on 17 June, reclassified imports of colloidal precious metals and compounds from free to restricted.
This policy change now requires special authorisation to bring in materials such as potassium gold cyanide (PGC), which is widely used to enhance conductivity in electronic components.
Industry associations have sounded the alarm. The India Cellular and Electronics Association (ICEA) wrote to the Ministry of Electronics and IT, saying the restrictions are creating uncertainty and slowing down domestic production.
In a report by the Business Standard, ICEA Chairman Pankaj Mohindroo warned that such policy shifts could discourage investment in India’s emerging electronics ecosystem.
The Electronic Industries Association of India (ELCINA) also raised concerns over customs delays. Shipments containing gold compounds are reportedly being held up at ports, disrupting production lines and threatening supply chain continuity.
ELCINA Secretary General Rajoo Goel clarified that these imports are used strictly in manufacturing and are not part of the precious metals trade.
Recently, China made headlines by tightening control over rare earth magnet exports and restricting high-tech capital equipment sales, adding further strain on Indian manufacturers.
The shortage of specialised inputs and machinery is already delaying operations for several companies.
Industry experts estimate that tens of thousands of jobs in regions like Noida and South India could be at risk. With flagship initiatives like ‘Make in India’, PLI, and ECMS depending on steady supply chains, the sector is urging swift policy intervention to avoid further setbacks.
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