The Mobile Phone Manufacturing Scheme will run from April 2026 to FY31, with the government targeting around ₹39 lakh crore in cumulative production and 60,000 direct jobs.
Manufacturers can receive 2.25%-5% base incentives, with additional incentives for domestic components, sub-assemblies, product design and R&D.
The new scheme follows the PLI programme, under which mobile phone production reached ₹11.61 lakh crore and India emerged as the world's second-largest mobile phone manufacturer by volume.
The government has notified the ₹62,500-crore Mobile Phone Manufacturing Scheme (MPMS) to expand domestic handset production and strengthen India's electronics supply chain.
The five-year programme will run from April 1, 2026, through FY31, Electronics and Information Technology Secretary S Krishnan said. The Union Cabinet had approved the scheme on July 15.
1 August 2026
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The government expects the programme to generate around ₹39 lakh crore in cumulative mobile phone production and create approximately 60,000 direct jobs over its five-year duration.
Incentives For Local Sourcing And Innovation
The scheme provides manufacturers with base incentives ranging from 2.25% to 5% on eligible sales of mobile phones produced in India.
Companies can receive an additional incentive of up to 1.5% for sourcing specified components and sub-assemblies domestically.
The framework also offers an additional 3% incentive on eligible sales linked to product design and research and development aimed at developing Indian brands.
Krishnan said Indian handset manufacturers would qualify for higher incentives of up to 5%, as the government seeks to help domestic brands expand into international markets.
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Domestic value addition in India's mobile phone industry has already increased from around 15% to 23%, according to Krishnan.
Building On The PLI Scheme
The MPMS follows the Production Linked Incentive Scheme for Large Scale Electronics Manufacturing (PLI-LSEM), which concluded on March 31, 2026.
The earlier programme focused primarily on expanding the scale of electronics and mobile phone manufacturing in India.
According to Krishnan, mobile phone production under PLI 1.0 reached ₹11.61 lakh crore, exceeding the target of ₹8.12 lakh crore.
Investment under the scheme also crossed ₹20,500 crore, compared with the original target of ₹7,000 crore.
The PLI programme attracted major global handset manufacturers and contract manufacturers, including Samsung and companies producing Apple devices in India.
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Around $14 billion has been invested across India's electronics ecosystem since the launch of PLI 1.0, while the mobile phone manufacturing ecosystem now supports approximately 12 lakh jobs, Krishnan said.
The new scheme is intended to move beyond manufacturing scale and build greater depth within the domestic supply chain.
India’s Mobile Export Push
India has emerged as the world's second-largest mobile phone manufacturer by volume, with 99.2% of mobile phones used domestically now manufactured within the country, according to the government.
Mobile phone exports increased 166 times between 2014 and 2025, registering a compound annual growth rate of 59%, Krishnan said.
Mobile phones accounted for around 61% of India's total electronics exports in FY26, while smartphones became the country's single-largest exported product category in 2025, according to MeitY.
The government expects the MPMS to build on this momentum by increasing manufacturing scale, encouraging domestic sourcing and improving the global competitiveness of India's handset industry.
