Daijiworld Media Network - New Delhi
New Delhi, Jul 15: The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved the Mobile Phone Manufacturing Scheme (MPMS) with a financial outlay of Rs 62,500 crore, aimed at expanding domestic handset production, increasing exports and strengthening India's position as a global electronics manufacturing hub.
The scheme will be implemented over a five-year period from FY2026-27 to FY2030-31 and is designed to enhance supply chain resilience, improve the global competitiveness of Indian manufacturing and promote the growth of indigenous mobile phone brands through greater investment in product design and research and development (R&D).
Under the new policy, eligible manufacturers will receive production-linked incentives ranging from 2.25 per cent to 5 per cent on the sale of mobile phones manufactured in India. The incentive structure varies depending on the category of production and investment.
To encourage local value addition, the scheme also offers an additional incentive of up to 1.5 per cent for companies that source key components and sub-assemblies from within the country.
Manufacturers investing in the design and development of Indian mobile phone brands will be eligible for a further 3 per cent incentive on eligible sales, providing a major boost to domestic innovation and technology development.
According to the Cabinet, the MPMS is expected to generate cumulative mobile phone production worth nearly Rs 39 lakh crore during its operational period while substantially increasing India's handset exports to global markets.
The initiative is also projected to create around 60,000 direct employment opportunities, contributing to job creation and supporting the country's broader economic growth.
The government said the scheme builds on the achievements of the Make in India programme, under which India's electronics manufacturing output has grown seven-fold, while electronics exports have increased 11-fold since FY2014-15.
India has now emerged as the world's second-largest mobile phone manufacturer by volume, with 99.2 per cent of the mobile phones used domestically being produced within the country.
The Cabinet also highlighted that smartphones became India's largest export product category in 2025, overtaking traditional export items such as diesel fuel and cut diamonds, reflecting the rapid expansion of the country's electronics manufacturing sector.
The MPMS replaces the Production Linked Incentive Scheme for Large Scale Electronics Manufacturing (PLI-LSEM), which concluded on March 31. The government credited the earlier scheme with transforming India into one of the world's leading centres for mobile phone manufacturing and exports, laying the foundation for the next phase of growth under the new initiative.