Government Notifies ₹62,500 Crore Mobile Phone Manufacturing Scheme

The Ministry of Electronics and Information Technology has notified the Mobile Phone Manufacturing Scheme (MPMS) with an outlay of ₹62,500 crore, aiming to deepen domestic value addition, strengthen Indian mobile phone brands and improve India’s competitiveness in global electronics manufacturing.

The five-year scheme will run from FY 2026-27 to FY 2030-31 and is expected to support cumulative mobile phone production of around ₹39 lakh crore while generating nearly 60,000 direct jobs.

Union Electronics and Information Technology Minister Ashwini Vaishnaw said the scheme would place greater emphasis on Indian-owned brands, intellectual property, product design and research and development. He said the government expects India to see its first strong indigenous mobile phone brand by around mid-2027.

Two Target Segments

MPMS has been divided into two categories. Target Segment 1 will incentivise large-scale mobile phone manufacturing, while Target Segment 2 will specifically support Indian-owned mobile phone brands.

Under TS1, eligible companies can receive incentives ranging from 2.25% to 5%. Under TS2, Indian brands can receive a 5% incentive, along with an additional 3% incentive for Indian design and R&D.

Both categories can also receive an additional incentive of up to 1.5% for domestic sourcing of key components and sub-assemblies, provided locally sourced components are used in at least 25% of mobile phones manufactured during the financial year.

Focus on Genuine Indian Ownership

Eligibility under the Indian-brand category requires companies to be registered or incorporated in India, with their intellectual property and trademarks held domestically. Management control must remain with Indian citizens, while more than 51% of the shareholding must also be held by Indian citizens.

Companies must additionally maintain in-house R&D and design capabilities in India.

The government said it would carefully examine ownership structures to ensure that brands seeking these incentives represent genuine Indian intellectual property and control rather than merely local assembly operations.

Building on India’s Mobile Manufacturing Expansion

The new scheme follows the conclusion of the Production Linked Incentive Scheme for Large Scale Electronics Manufacturing on 31 March 2026.

India’s electronics manufacturing sector has expanded sharply since FY 2014-15, with production increasing seven-fold and exports rising eleven-fold. Mobile phones have been one of the main drivers of this expansion.

India is now the world’s second-largest mobile phone manufacturer by volume, while the government says 99.2% of mobile phones used in the country are manufactured domestically. Smartphones also became India’s single-largest exported product category in 2025.

The MPMS now seeks to move the sector beyond large-scale assembly by encouraging deeper component localisation, Indian-controlled brands, domestic R&D and ownership of valuable intellectual property.

The scheme could strengthen India’s position not only as a global mobile phone manufacturing hub but also as a centre for indigenous product development and electronics design.

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