India Approves Mobile Phone Manufacturing Scheme to Boost Electronics Industry

India Unveils New Mobile Manufacturing Push

The Union Cabinet has approved the Mobile Phone Manufacturing Scheme, widely seen as the next phase of India’s production linked incentive programme for smartphones. With a budget allocation of Rs 62500 crore, the initiative is designed to expand the country’s electronics manufacturing capabilities beyond simple phone assembly.

The scheme forms part of the government’s larger development package worth Rs 2.19 lakh crore. It aims to strengthen the domestic electronics supply chain while supporting India’s ambition to become a global manufacturing hub for mobile devices and electronic components.

Focus Shifts Beyond Phone Assembly

Unlike the previous incentive programme, the new scheme places strong emphasis on manufacturing key electronic components within India. The government also wants to encourage companies to build complete mobile ecosystems, including research, design, and advanced production.

Another important objective is to help Indian smartphone brands develop their own technologies, intellectual property, and global presence instead of depending mainly on overseas manufacturers.

Employment and Production Targets

According to Union Minister for Electronics and Information Technology Ashwini Vaishnaw, the scheme is expected to generate more than 60000 direct jobs over the five year period from financial year 2026 to 2031. In addition, it is expected to create several lakh indirect employment opportunities across manufacturing and related industries.

The government expects the programme to support mobile phone production worth nearly Rs 39 lakh crore during the implementation period. It has also set a target of exporting mobile phones valued at around Rs 15 lakh crore.

Attractive Incentives for Manufacturers

The scheme offers financial incentives to companies that expand manufacturing within the country.

Manufacturers producing and selling mobile phones in India can receive incentives ranging from 2.25 percent to 5 percent.

Companies using locally manufactured electronic components can earn an additional incentive of up to 1.5 percent.

Indian brands investing in product design, innovation, and research can receive an extra 3 percent incentive to strengthen domestic technology development.

Strengthening Make in India

India has made remarkable progress in mobile manufacturing over the past few years. Around 99.2 percent of the mobile phones used in the country are now manufactured domestically.

The country has also become the world’s second largest mobile phone producer. Mobile phones have emerged as India’s biggest single export product in 2025, surpassing exports of diesel fuel and cut diamonds.

The long term vision of the Mobile Phone Manufacturing Scheme is to transform India from an assembly destination into a technology driven manufacturing nation with its own patents, innovation capabilities, and globally competitive mobile brands.