India took a significant step to strengthen its electronics ecosystem when the Union Cabinet, on 15 July 2026, cleared the Mobile Phone Manufacturing Scheme (MPMS) with a total budgetary outlay of ₹62,500 crore. The new scheme will run for five financial years, from FY 2026-27 to FY 2030-31, and takes over from the earlier Production Linked Incentive (PLI) Scheme for Large Scale Electronics Manufacturing, which concluded on 31 March 2026. The move signals continuity in policy support while shifting the focus more firmly towards deeper value addition and home-grown innovation.

At its heart, the MPMS offers incentive support on the eligible sales of mobile phones that are actually manufactured within India. The base incentive is tiered between 2.25% and 5%, and manufacturers can earn an extra benefit of up to 1.5% for sourcing key components and sub-assemblies domestically. A further 3% incentive is available on eligible sales that relate to product design and Research and Development — a clause deliberately tied to Indian brands and indigenous innovation, so that the country moves beyond mere assembly towards owning the design layer of the value chain.

The scheme's objectives are broad but clear: scale up mobile phone output, deepen domestic value addition, build supply-chain resilience against external shocks, and sharpen India's global competitiveness in electronics. In numeric terms, the government expects the MPMS to generate cumulative mobile phone production of roughly ₹39 lakh crore over its tenure, with projected exports of about ₹15 lakh crore and direct employment of around 60,000 jobs.

Mobile phones sit within the wider electronics manufacturing sector, which also covers consumer electronics, industrial electronics and communication equipment. Over recent years India has repeatedly used PLI-style frameworks in this space to expand domestic manufacturing and cut import dependence. The idea of "domestic value addition" — the share of components, assembly, design and services added inside India — is central here, as is "supply-chain resilience", the ability to keep producing even when components, logistics or trade are disrupted.

For competitive-exam aspirants, the MPMS is a rich source of material spanning the economy, government schemes, and science & technology, and is highly likely to appear in both prelims and mains of UPSC, RPSC, SSC and Banking examinations.

Important Facts for Exams

Practice Questions (MCQs)

Total 10 questions — 7 medium level and 3 UPSC/RPSC level.

UPSC / RPSC Relevance

• ➜ Prelims: MPMS outlay, tenure, incentive structure, the PLI scheme it replaces.
• ➜ Mains GS-III: Manufacturing, electronics value chain, employment generation, import substitution.
• ➜ Economy: Domestic value addition, supply-chain resilience, export competitiveness.

UPSC Mains Descriptive Question