With the US threat of trade war imposing hefty tariffs on Chinese imports, China-based foreign electronic vehicle (EV) component makers are learnt to have intended to shift their base to India and other emerging EV markets alike soon, while at the same time India is ready to accommodate their businesses in the country. The government is also willing to expand its base on EV equipment makers to boost production capacity in India and cut dependency from China as well, a government source said on Sunday.The development comes amid China’s move to restrict the supply of the magnets, essential for traction motors and various components used in EVs and automobiles, since April 4. China’s dominance in the rare earth magnet industry is significant as it produces about 90 per cent of the world’s supply. However, China-based foreign companies are increasingly seeking ways to diversify their supply chains and reduce their reliance on China after the US President Donald Trump ramped up tariffs on Chinese imports, slapping a 145 per cent duty on a vast range of goods, including EV components.As per the source, shortage of such components are likely to disrupt supply chains and slow down production, which may not meet India's growing demands in the EV component sector. Last week, automobile and component manufacturers met key officials in the concerned ministries and sought an immediate intervention of the government in this matter as China has restricted the supply of rare earth magnets, an indispensable part of electric vehicles.As a trade war plays out between the US and China, there are reports of several EV companies looking to move a part of their production to India from China. As per new Chinese regulation, the source said, magnets will only be supplied to companies that submit an end-user certificate in a prescribed format. Importers must get the certificate authorised by the ministry of external affairs and the Chinese embassy. “They also have to confirm that the magnets won’t be used in weapons or transferred to third parties,” the source said.Assuring the component makers, the officials said that the government is aware of this development and trying to resolve it soon. “Apart from higher tariffs, automakers and suppliers, be it Indian or foreign firms, must contend with national security restrictions that are an increasingly important factor in the auto electronics sector. We believe that India always provides them better security and minimal government interference to their businesses,” said an official.“Unlike China, India is a young nation with growing demands of the EV sector. As far as the foreign EV firms’ shifting base to India is concerned, they are most welcome. We are mulling multiple options to provide a seamless entry to not only EV equipment makers, but also others like chip and semiconductors makers into the country. They should take advantage of our government policies for the ‘ease of doing’ their businesses as well,” he added.As per the reports, with the uncertainty now dominating the market due to tariff war, Spanish metal components maker Gestamp — a supplier of chassis, battery boxes and other key auto parts — has suffered from a slowdown in the US and western European markets, but it is expanding its base in Asia, including India, Latin America and eastern Europe. Similarly, another auto leader, Japan’s Nissan plans to launch 10 new EVs in China by 2027, nine of them its own brand, and to spend an extra $1.4 billion by the end of 2026 on its expansion there. As the market changes very quickly due to war on tariffs, the company said that it is now open to some options to ramp up its spare capacity in the US in order to make up for reduced imports.