Another push for India to cement its position as a global smartphone manufacturing hub? The government greenlights a dedicated incentive policy now.
The central government has approved the Mobile Phone Manufacturing Scheme (MPMS), allocating ₹625 billion to accelerate mobile phone production, domestic value addition and support research and development (R&D), design and exports over the next five years.
Approved by the Cabinet chaired by Prime Minister Narendra Modi, the scheme will operate from FY2026-27 to FY2030-31. It succeeds the Production Linked Incentive (PLI) Scheme for Large Scale Electronics Manufacturing, which concluded on 31 March 2026.
Under the new programme, manufacturers will receive incentives ranging from 2.25% to 5% on eligible sales of mobile phones produced in India. Companies sourcing key components and sub-assemblies domestically will be eligible for an additional incentive of up to 1.5%.
Furthermore, Indian brands investing in product design and R&D can also receive an extra 3% incentive on eligible sales.
The government said the scheme is intended to increase production capacity, improve supply chain resilience, deepen domestic manufacturing capabilities and enhance India’s competitiveness in global electronics markets.
It also aims to encourage the development of Indian intellectual property and homegrown technology through greater investment in design and R&D.
According to official estimates, the scheme could help generate cumulative mobile phone production worth around ₹39 trillion during its tenure while significantly increasing exports. It is also expected to create approximately 60,000 direct jobs.
The government highlighted the rapid expansion of India’s electronics manufacturing sector since FY2014-15, noting that overall electronics production has increased sevenfold while exports have grown elevenfold.
India has also become the world’s second-largest mobile phone manufacturer by volume, with 99.2% of mobile phones used domestically now manufactured within the country.
Smartphones also emerged as India’s largest export product category in 2025, overtaking diesel fuel and cut diamonds, underscoring the sector’s growing contribution to the country’s manufacturing and export economy.
The government expects the MPMS to build on these gains by further expanding India’s role in global electronics supply chains.
