India Mobile Phone Manufacturing Scheme: India has approved a new plan to keep its smartphone manufacturing growth going even after the earlier Production Linked Incentive scheme for large-scale electronics ended on March 31, 2026. On July 15, 2026, the Union Cabinet cleared the Mobile Phone Manufacturing Scheme, or MPMS, with a budget outlay of Rs 62,500 crore. The government says the new plan is meant to raise local production, add more value inside India, and make the supply chain stronger and safer.
The scheme will run for five years, from FY 2026-27 to FY 2030-31. It is also meant to help Indian brands grow, build more patents, and support design and research work in the country. According to the official release, the plan is part of the wider Make in India push and is meant to deepen domestic value addition while improving global competitiveness.
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How the new Incentive Plan Works?
The new scheme gives incentives on eligible sales for phones made in India. The rate will be different for different categories and will range from 2.25% to 5%. Companies that use more local parts and sub-assemblies can get an extra incentive of up to 1.5%. Indian smartphone brands that do design and research work in India can also get an extra 3% incentive on eligible sales.
This means the government is not only trying to make more phones in India. It is also trying to make more of the phone parts in India and push companies to do more thinking, design, and innovation here. The official release says the goal is also to achieve technological sovereignty and create Indian patents in design and R&D.
What the Government Expects next
The Cabinet expects the scheme to create around 60,000 direct jobs during its five-year run. It also expects mobile phone production in India to reach about Rs 39,00,000 crore over the scheme period, along with a further rise in exports.
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The government says mobile phone manufacturing has already become a major driver of India’s electronics growth, and it notes that India is now the world’s second-largest mobile phone maker by volume, with 99.2% of phones used in India being made locally. It also says smartphones became India’s single largest export product category in 2025.
