Fact Box: Mobile Phone Manufacturing Scheme

The Union Cabinet approved the Mobile Phone Manufacturing Scheme (MPMS) on 15 July 2026 with a budgetary outlay of ₹62,500 crore. The scheme will run for five years from FY 2026-27 to FY 2030-31 and will replace the Production Linked Incentive Scheme for Large Scale Electronics Manufacturing, which ended on 31 March 2026.

Mobile Phone Manufacturing Scheme: Core Features

The MPMS provides incentive support on eligible sales of mobile phones manufactured in India. The incentive rates range from 2.25% to 5%, and an additional incentive of up to 1.5% is available for domestic sourcing of key components and sub-assemblies. The scheme also provides an additional 3% incentive on eligible sales for product design and Research and Development. This provision is linked with Indian brands and indigenous innovation in mobile phone manufacturing.

Objectives and Output Targets

The scheme is designed to scale up mobile phone production in India and deepen domestic value addition. It also seeks to strengthen supply chain resilience and improve global competitiveness in electronics manufacturing. During its tenure, the MPMS is expected to generate cumulative mobile phone production of about ₹39 lakh crore. The projected mobile phone exports under the scheme are around ₹15 lakh crore.

Mobile Phone Manufacturing in India

Mobile phones fall under the broader electronics manufacturing sector, which includes consumer electronics, industrial electronics, and communication equipment. India has used production-linked incentive frameworks in electronics to expand domestic manufacturing and reduce import dependence. Domestic value addition in electronics refers to the share of components, assembly, design, and related services added within India. Supply chain resilience in manufacturing refers to the ability to maintain production despite disruptions in components, logistics, or external trade.

Important Facts for Exams

• The Production Linked Incentive Scheme for Large Scale Electronics Manufacturing ended on 31 March 2026.
• The MPMS is a five-year scheme covering FY 2026-27 to FY 2030-31.
• The scheme provides an additional 3% incentive for product design and Research and Development.
• The projected direct employment generation under the scheme is around 60,000 jobs.

Mobile phones are a major segment of India’s electronics manufacturing sector. The MPMS is linked to mobile phone production, exports, domestic sourcing, and Research and Development.