Key Details
The Mobile Phone Manufacturing Scheme (MPMS) succeeds the large-scale electronics manufacturing PLI, which ended on 31 March 2026. It will operate from FY 2026–27 to FY 2030–31 with two distinct incentive tracks.
Scheme component | What it provides |
|---|---|
Large-scale manufacturing | 2.25%–5% incentive for eligible mobile manufacturers and electronics manufacturing services companies |
Indian mobile brands | 5% incentive, plus 3% for Indian design and R&D |
Domestic sourcing | Additional incentive of up to 1.5% for both segments |
Scale threshold | Minimum FY 2025–26 turnover of ₹10,000 crore for the first segment and ₹1,000 crore for Indian-brand applicants |
Expected outcomes | Around ₹39 lakh crore in production and 60,000 direct jobs over five years |
The Scheme Moves Beyond Phone Assembly
India is the world’s second-largest mobile-phone manufacturer by volume, and the Government says 99.2% of phones used domestically are made in India. Smartphones also became the country’s largest export product category in 2025.
MPMS seeks to build on this scale by rewarding domestic sourcing of key components and sub-assemblies. The additional incentive applies where eligible components are localised in at least 25% of the phones manufactured during a financial year.
This shifts the policy focus from the number of phones assembled in India towards the share of production value retained within the country.
A Separate Track Will Support Indian-Owned Brands
The second segment targets companies that meet the Scheme’s definition of an Indian Brand. Among other conditions:
The company, intellectual property and trademark must be registered or held in India.
Indian citizens must hold more than 51% of its shares and exercise management control.
The applicant must maintain in-house design and R&D capabilities in India.
Qualifying brands can receive a 5% base incentive, another 3% for Indian design and R&D, and up to 1.5% for domestic component sourcing. A one-year gestation period may also be permitted.
The higher support reflects a policy objective that extends beyond manufacturing capacity: creating Indian firms that control the brand, product design and intellectual property. The Government expects the first strong indigenous mobile brand to emerge by mid-2027, although this is a ministerial expectation rather than a guaranteed Scheme outcome.
Entry Thresholds Favour Firms Capable of Reaching Scale
Under the large-manufacturing segment, existing brands must have recorded at least ₹10,000 crore in turnover in FY 2025–26 and generate annual sales exceeding the base-year level by ₹5,000 crore. A new brand becomes eligible after reaching ₹10,000 crore in annual Indian sales, following which yearly incremental-sales conditions apply.
The thresholds may concentrate support among companies capable of producing at considerable scale. The separate Indian-brand track, with its lower ₹1,000 crore turnover requirement, creates a route for established domestic companies that are smaller than the leading global manufacturers.
Policy Relevance
Domestic value addition will be the decisive test. Higher production and exports will have greater industrial impact if India also captures component manufacturing, engineering, design and intellectual property.
Verification will determine credibility. MeitY will need to establish whether claimed Indian ownership, R&D and domestic sourcing represent substantive activity rather than formal compliance.
Component capacity must grow alongside phone assembly. The sourcing incentive can create demand, but firms also need reliable domestic suppliers that meet global requirements for quality, volume and cost.
The employment target should be assessed by job quality as well as numbers. Monitoring can cover wages, skills, gender participation and movement into technical and design roles.
Fiscal support should produce durable competitiveness. Over time, Indian brands must be able to compete through technology, distribution and product quality rather than continued dependence on incentives.
Relevant Question for Policy Stakeholders: Will MPMS enable India to retain more of the technology, intellectual property and component value embedded in mobile phones, or mainly extend the production growth achieved under the earlier PLI scheme?
Follow the Full Announcement Here: Government Notifies ₹62,500 Crore Mobile Phone Manufacturing Scheme