**Executive Summary**
The Union Cabinet has approved the Mobile Phone Manufacturing Scheme (MPMS) with a budgetary outlay of Rs 62,500 crore to scale up production and strengthen domestic value addition. The scheme will run for five years from FY 2026-27 to FY 2030-31, succeeding the PLI-LSEM scheme which concluded on March 31, 2026. It aims to generate 60,000 direct jobs and achieve a cumulative production value of approximately Rs 39,00,000 crore.
**Key Points / Main Content**
**Scheme Objectives and Tenure**
* **Purpose:** To enhance global competitiveness, deepen domestic value addition, and build Indian brands for technological sovereignty.
* **Timeline:** The scheme tenure is set for five years, spanning from FY 2026-27 to FY 2030-31.
* **Research & Development:** Focuses on creating Indian patents in design and R&D to capture higher economic value.
**Incentive Structure**
* **Standard Incentives:** Provides support on eligible sales at differentiated rates ranging from 2.25% to 5%.
* **Sourcing Incentives:** An additional incentive of up to 1.5% is available, linked to the domestic sourcing of key components and sub-assemblies.
* **Indian Brand Support:** An additional 3% incentive on eligible sales is provided for design and R&D specifically for building Indian brands.
**Context and Economic Impact**
* **Production Targets:** Total mobile phone production is expected to reach nearly Rs 39,00,000 crore during the scheme's tenure.
* **Employment:** The initiative is projected to create approximately 60,000 direct jobs.
* **Market Position:** India is currently the world's second-largest mobile phone manufacturer by volume, with 99.2% of domestic demand met by local manufacturing as of 2025-26.
**Impact Analysis**
**Mobile Phone Manufacturers**
* **Impact:** They will receive tiered financial incentives based on sales volume and sourcing choices, enhancing their global competitiveness.
* **Action Required:** Manufacturers must align their production and supply chain strategies to meet the eligibility criteria for differentiated incentive rates.
**Indian Domestic Brands**
* **Impact:** These entities receive a specialized 3% additional incentive to support domestic design and R&D efforts.
* **Action Required:** Brands need to invest in localized R&D and design capabilities to claim the additional financial support.
**Domestic Component Suppliers**
* **Impact:** Increased demand for locally made parts as manufacturers seek the 1.5% additional incentive linked to domestic sourcing.
* **Action Required:** Suppliers must scale up production and quality standards to meet the requirements of mobile phone assemblers.
**Workforce/Job Seekers**
* **Impact:** The sector is expected to become a major employer, particularly for youth, with 60,000 new direct positions anticipated.
* **Action Required:** Prospective employees may need to seek relevant vocational training to benefit from new manufacturing opportunities.
Key Entities Referenced
Mobile Phone Manufacturing Scheme (MPMS): A five-year fiscal incentive scheme (FY 2026-27 to FY 2030-31) with a ₹62,500 crore outlay aimed at boosting domestic production, design, and R&D of mobile phones.
Production Linked Incentive Scheme for Large Scale Electronics Manufacturing (PLI-LSEM): The predecessor incentive program that ended on March 31, 2026, which established the foundation for India's electronics manufacturing ecosystem.
Ministry of Electronics & IT: The primary government ministry responsible for the administration and implementation of electronics manufacturing policies and schemes.
Make in India: The national industrial vision and initiative providing the strategic framework for propelling electronics manufacturing and export growth.
Ministry of Electronics & IT
Cabinet approves Mobile Phone Manufacturing
Scheme (MPMS)
प्रव तथ: 15 JUL 2026 3:26PM by PIB Delhi
The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has approved the Mobile Phone
Manufacturing Scheme (MPMS) with a budgetary outlay of Rs 62,500 crore (Rupees Sixty-Two Thousand
Five Hundred Crore Only).
Salient Features:
To further scale up the production, deepen domestic value addition, strengthen supply chain resilience,
enhance global competitiveness, the Government has launched the Mobile Phone Manufacturing Scheme
(MPMS).
MPMS scheme also aims at building Indian brands to achieve technological sovereignty, capture large
economic value and create Indian patents in design and R&D.
The scheme tenure shall be 5 Years i.e. from FY 2026-27 to FY 2030-31.
The scheme provides incentive support on eligible sales for manufacturing of mobile phones in India at
differentiated rates ranging from 2.25% to 5%. Scheme also provides additional incentive of up to 1.5%
linked to domestic sourcing of key components/ sub-assemblies. For building Indian brands, an additional
incentive @3% on Eligible Sales for design and R&D of the product.
Expected Outcomes:
During the scheme tenure, the 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
also expected to generate around 60,000 direct jobs thereby contributing to economic growth, employment
generation and strengthening India’s position in global electronics manufacturing hub.
Context:
Prime Minister’s Make in India vision has propelled electronics manufacturing to grow 7 times and
exports to grow 11 times since FY 2014-15. Electronics manufacturing sector has also emerged as a major
employer, especially for young men and women from far flung villages, with a few plant employing more
than 5,000 employees at a single location.
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 such as diesel fuel and cut diamonds. Mobile phones now constitute a
major share of India’s electronics production and exports and are playing a critical role in strengthening
India’s position in global value chains.
The Production Linked Incentive Scheme for Large Scale Electronics Manufacturing (PLI-LSEM) has
played a transformative role in establishing India as a global hub for mobile manufacturing and exports.
The tenure of PLI-LSEM ended on 31st March 2026.****
MJPS
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