India Boosts Mobile Manufacturing with New Incentive Scheme

The Union Cabinet approved a Rs 62,500 crore Mobile Phone Manufacturing Scheme to enhance India's global competitiveness in mobile production, aiming for Rs 39 lakh crore in production by 2031, along with increased exports, domestic value addition, and job creation.

In a significant move to bolster India's position in the global electronics industry, the Union Cabinet on Wednesday approved the Mobile Phone Manufacturing Scheme (MPMS). With a budgetary outlay of Rs 62,500 crore, the scheme targets mobile phone production worth Rs 39 lakh crore over its five-year duration, slated to span from FY 2026-27 to FY 2030-31.

The scheme offers differentiated incentive support ranging from 2.25% to 5% on eligible sales of domestically manufactured mobile phones. Furthermore, it provides additional incentives of up to 1.5% for local sourcing of components and sub-assemblies. To encourage innovation, an extra 3% incentive is available for product design and R&D, aiming to foster Indian brands and patents.

Union Electronics and Information Technology Minister Ashwini Vaishnaw emphasized the transformative impact of recent efforts in electronics manufacturing, highlighting that India has shifted from being a mobile phone importer to the world's second-largest manufacturer. The initiative is expected to generate 60,000 direct jobs, fortifying India as a global electronics manufacturing hub.