Union Govt approves Rs 62,500 crore Mobile Phone Manufacturing Scheme

Ziraat Times Team Report

New Delhi, July 15: The Union Cabinet on Wednesday approved the Mobile Phone Manufacturing Scheme (MPMS) with a budgetary outlay of Rs 62,500 crore to boost domestic mobile phone production, deepen local value addition and strengthen India’s position as a global electronics manufacturing hub.

The decision was taken at a Cabinet meeting chaired by Prime Minister Narendra Modi.

The new scheme will be implemented over five years, from 2026-27 to 2030-31, and succeeds the Production Linked Incentive Scheme for Large Scale Electronics Manufacturing (PLI-LSEM), which concluded on March 31, 2026.

According to the government, the MPMS aims to scale up mobile phone manufacturing, strengthen domestic supply chains, enhance global competitiveness and promote Indian brands through greater investment in design and research and development (R&D).

Under the scheme, manufacturers will receive incentives ranging from 2.25 per cent to 5 per cent on eligible sales of mobile phones produced in India. An additional incentive of up to 1.5 per cent will be provided for domestic sourcing of key components and sub-assemblies, while Indian brands investing in product design and R&D will be eligible for an additional 3 per cent incentive on eligible sales.

The government said the scheme is expected to facilitate cumulative mobile phone production worth around Rs 39 lakh crore during its five-year tenure, while significantly increasing exports.

It is also projected to generate around 60,000 direct jobs, contributing to employment generation and economic growth.

Highlighting the country’s progress in electronics manufacturing, the government said the Make in India initiative has helped electronics manufacturing expand seven-fold and exports grow eleven-fold since 2014-15.

India has also emerged as the world’s second-largest mobile phone manufacturer by volume, with 99.2 per cent of mobile phones used in the country now being manufactured domestically.

The government noted that smartphones became India’s largest export product category in 2025, overtaking traditional exports such as diesel fuel and cut diamonds. Mobile phones now account for a significant share of the country’s electronics production and exports, strengthening India’s integration into global value chains.

Officials said the earlier PLI-LSEM scheme played a transformative role in establishing India as a major global centre for mobile phone manufacturing and exports. The newly approved MPMS is expected to build on those gains by increasing domestic value addition, promoting innovation and supporting the emergence of globally competitive Indian mobile phone brands.