The Union Cabinet chaired by Prime Minister Narendra Modi has approved the Mobile Phone Manufacturing Scheme (MPMS) with a budgetary outlay of Rs 62,500 crore. The scheme has a tenure of 5 years from FY 2026-27 to FY 2030-31.
Scheme Objectives and Features
The MPMS aims to scale up production, deepen domestic value addition, strengthen supply chain resilience, enhance global competitiveness, build Indian brands to achieve technological sovereignty, capture large economic value, and create Indian patents in design and R&D. The scheme provides incentive support on eligible sales for manufacturing mobile phones in India at differentiated rates ranging from 2.25% to 5%. It also offers an additional incentive of up to 1.5% linked to domestic sourcing of key components/sub-assemblies. For building Indian brands, an additional incentive of 3% on eligible sales is provided for design and R&D of the product.
Expected Outcomes
During the scheme tenure, cumulative mobile phone production in the country is expected to reach approximately Rs 39,00,000 crore with significant increase in exports of mobile phones. The scheme is expected to generate around 60,000 direct jobs, contributing to economic growth, employment generation and strengthening India's position as a global electronics manufacturing hub.
Context and Background
The scheme builds on the success of Prime Minister's Make in India vision, which has propelled electronics manufacturing to grow 7 times and exports to grow 11 times since FY 2014-15. Mobile phone manufacturing 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% of mobile phones used in India being manufactured domestically. Smartphones have emerged as the single largest exported product category from India in 2025, surpassing traditional leading export items. The Production Linked Incentive Scheme for Large Scale Electronics Manufacturing (PLI-LSEM), which played a transformative role in establishing India as a global hub for mobile manufacturing and exports, ended on 31st March 2026.