Union Cabinet Approves Rs 62500 Crore Mobile Manufacturing Scheme to Boost Production and Jobs

The Union Cabinet has approved a new Rs 62500 crore mobile manufacturing scheme aimed at accelerating India’s electronics manufacturing sector. The initiative builds on the success of the earlier Production Linked Incentive program and is expected to drive higher domestic production, increase exports, and create significant employment opportunities over the next five years.

The government has set an ambitious target of producing mobile phones worth Rs 39 lakh crore during the scheme’s five year tenure. This marks a substantial increase from the previous PLI program, under which India recorded smartphone production worth Rs 22 lakh crore. Officials believe the new initiative will further strengthen the country’s position as one of the world’s fastest growing electronics manufacturing destinations.

Union Minister for Electronics and Information Technology Ashwini Vaishnaw said the revised scheme places greater emphasis on local value addition, indigenous component manufacturing, research and development, and exports. The policy is designed to encourage companies to source more components within India while promoting innovation by domestic brands.

Manufacturers participating in the scheme will receive incentives ranging from 2.25 percent to 5 percent on the sale of mobile phones produced in India. Companies that procure key components from domestic suppliers will also be eligible for an additional incentive of up to 1.5 percent. Indian brands investing in product design and research and development can receive a further 3 percent incentive, encouraging greater technological innovation within the country.

The government expects the new policy to generate around 60000 direct jobs during its implementation. The earlier PLI program had already created nearly two lakh employment opportunities while attracting substantial investment from leading global smartphone manufacturers.

The previous Production Linked Incentive scheme played a major role in transforming India’s smartphone manufacturing landscape. Global companies, including Apple, significantly expanded their manufacturing operations in India, helping smartphones emerge as one of the country’s leading export products. The initiative also increased domestic value addition in mobile manufacturing by around 24 percent.

According to government data, more than Rs 19000 crore in incentives were distributed under the earlier PLI scheme. In return, the government collected nearly Rs 25000 crore in direct taxes and approximately Rs 3 lakh crore through GST revenue. The scheme also attracted investments exceeding Rs 20000 crore, surpassing its initial targets by a considerable margin.

India’s smartphone production under the previous program reached approximately Rs 11.61 lakh crore, achieving about 142 percent of the original production target. This performance has encouraged the government to introduce a larger and more comprehensive manufacturing policy focused on long term growth.

Industry leaders have welcomed the new initiative. Indian Cellular and Electronics Association President Pankaj Mohindroo said the policy could help increase India’s share of global mobile phone manufacturing to between 35 percent and 40 percent. He added that the scheme is expected to strengthen India’s role in global supply chains while promoting advanced technology, engineering capabilities, electronics manufacturing, and innovation.

With larger financial incentives, greater support for domestic sourcing, and a stronger focus on research and exports, the new mobile manufacturing scheme is expected to accelerate India’s journey toward becoming a global hub for smartphone production and electronics manufacturing in the coming years.