Blitz Bureau
NEW DELHI: The Union Cabinet chaired by Prime Minister Narendra Modi approved the Mobile Phone Manufacturing Scheme (MPMS) on July 15 with a budgetary outlay of Rs 62,500 crore and a tenure of five years, from FY 2026-27 to FY 2030-31.
The scheme aims to further scale up the production of mobile phones, deepen domestic value addition, strengthen supply chain resilience and enhance global competitiveness.
MPMS also aims at building Indian brands to achieve technological sovereignty, capture large economic value and create Indian patents in design and R&D.
The scheme provides incentives on eligible sales for manufacturing of mobile phones in India at differentiated rates ranging from 2.25 per cent to 5 per cent. There will be additional incentive of up to 1.5 per cent linked to domestic sourcing of key components and sub-assemblies. For building Indian brands, an additional incentive of 3 per cent on eligible sales will be provided for design and R&D of the product.
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In the next five years the cumulative mobile phone production in the country is expected to reach approximately Rs 39,00,000 crore with significant increase in exports. The scheme is also expected to generate around 60,000 direct jobs thereby contributing to economic growth, employment generation and strengthening India’s position in global electronics manufacturing hub.
Prime Minister’s Make in India vision has propelled electronics manufacturing to grow seven times and exports to grow 11 times since FY 2014-15. Electronics manufacturing sector has also emerged as a major employer, especially for young men and women from far flung villages, with a few plant employing more than 5,000 employees at a single location.
Mobile phone manufacturing, which essentially comprises assembling at present, has been the key driver of this growth and has emerged as the anchor of India’s electronics manufacturing ecosystem. India is now the world’s second-largest mobile phone manufacturer by volume, with 99.2 per cent of mobile phones used in India being assembled domestically.
Smartphones have emerged as the single largest exported product category from India in 2025, surpassing traditional leading export items such as diesel fuel and cut diamonds. Mobile phones now constitute a major share of India’s electronics production and exports and are playing a critical role in strengthening India’s position in global value chains.
The Production Linked Incentive Scheme for Large Scale Electronics Manufacturing (PLI-LSEM) which ended on March 31 has played a transformative role in establishing India as a global hub for mobile manufacturing and exports.
