Incentive scheme for mobile phone manufacturing, worth ₹62,500cr, approved
What's the story
The Union Cabinet has approved a whopping ₹62,500 crore for the second phase of the mobile phone production-linked incentives scheme. The decision was announced by Information Technology Minister Ashwini Vaishnaw today. The Mobile Phone Manufacturing Scheme (MPMS) aims to bolster India's position as a global electronics manufacturing hub by promoting domestic production and attracting fresh investments.
Scheme goals
Key features of the MPMS scheme
The MPMS scheme will be implemented over five years from FY 2026-27 to FY 2030-31.
It aims to build Indian brands, achieve technological sovereignty, and create patents in design and R&D.
The scheme also provides differentiated incentive support on eligible sales for manufacturing mobile phones in India at rates between 2.25% and 5%.
An additional incentive of up to 1.5% is offered for domestic sourcing of key components/sub-assemblies.
Economic impact
Expected outcomes of the scheme
The MPMS scheme is expected to push cumulative mobile phone production in India to around ₹39 lakh crore during its tenure. It will also significantly increase exports and create around 60,000 direct jobs.
Manufacturing growth
India's growth as a global mobile manufacturing hub
With a push toward mobile phone production, India has become the world's second-largest mobile manufacturer.
The country's mobile phone production more than doubled to ₹5.5 lakh crore in FY 2024-25 from ₹2.14 lakh crore in FY 2019-20.
Mobile phone exports have also skyrocketed eight-fold during this period, from ₹0.27 lakh crore in FY 2019-20 to ₹2 lakh crore in FY 2024-25.