China’s latest export controls have significantly impacted Apple’s supply chain in India, underscoring Beijing’s ability to leverage critical chokepoints to blunt India’s burgeoning manufacturing ambitions. At the center of the disruption is Foxconn’s Telangana facility, which assembles Apple AirPods and is currently facing a shortage of dysprosium, a rare earth element essential for magnets in the earbuds. 

This shortage stems from China’s recent delay in approving dysprosium exports to India—an explicit step in Beijing’s tightening grip on rare earth mineral flows that are crucial for electronics manufacturing.

These curbs are only part of a broader set of Chinese measures. In recent weeks, over 300 Chinese engineers and technicians were recalled from India’s iPhone plants at Foxconn’s behest, reportedly under pressure from Chinese authorities.

The withdrawal not only threatens timelines for launching new iPhone models assembled in India but also exposes the deep dependency of India’s nascent electronics hubs on Chinese technical expertise and specialised manufacturing equipment.

Foxconn maintains that there is not yet a full disruption, but production at the site did slow temporarily, with the company petitioning Indian authorities for help expediting the necessary export permissions from China. The disruption is especially pointed as Foxconn, alongside Apple, accelerates investments in large-scale manufacturing facilities in India, positioning the country as a key alternative to China amidst intensifying US-China trade tensions and threatened tariffs on goods from both regions.

Industry experts note that despite India’s rapid scaling of electronics assembly, the country still depends heavily on China for upstream components such as rare earths, printed circuit boards, specialty chemicals, and key manufacturing machinery.

China accounts for more than 60% of global rare earth production but controls over 90% of magnet output, placing India—and multinationals hoping to diversify supply chains—at strategic risk when tensions escalate.

The Chinese government’s export denial policies, impacting both personnel and materials, clearly demonstrate how geopolitical competition is now intertwined with global electronics production dynamics. For India, the Foxconn episode is a warning that “Make in India” ambitions are vulnerable to external pressure until the country develops deeper domestic capabilities beyond assembly, and builds redundant supply chains that are less exposed to sudden restrictions from abroad.

Based On Swarajyamag Report