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The Ministry of Electronics and Information Technology notified the Mobile Phone Manufacturing Scheme (MPMS) with an outlay of Rs 62,500 crore.
The scheme runs for five years, from FY 2026-27 to FY 2030-31, and pays incentives on eligible sales at differentiated rates of 2.25 to 5 per cent.
An additional incentive of up to 1.5 per cent is available for sourcing key components and sub-assemblies domestically.
It has two target segments - TS1 for mobile phone manufacturing and TS2 for Indian mobile phone brands, with Indian brands exempt from any threshold sales volume.
The Government expects about Rs 39 lakh crore of cumulative production and around 60,000 direct jobs over the five years.
| Feature | Target Segment 1 (TS1) | Target Segment 2 (TS2) |
|---|---|---|
| Meant for | Mobile phone manufacturers, including electronics manufacturing services (EMS) companies registered in India | Indian mobile phone brands |
| Turnover condition | Rs 10,000 crore in FY 2025-26, subject to conditions | At least Rs 1,000 crore in FY 2025-26, with 51 per cent Indian ownership |
| Threshold sales volume | Applicable | Not required for Indian brands |
| Gestation period | Not specified | One year allowed to applicants |
| Selection | Against notified eligibility conditions | Indian brands shortlisted by an Empowered Committee |
Notified by MeitY on 1 April 2020 with an outlay of about Rs 41,000 crore, to attract mobile phone and component manufacturing to India by rewarding incremental sales
Key: It made India a major mobile phone assembly base but attracted criticism that value addition stayed low because components continued to be imported
Deepen the domestic supply chain rather than simply expand assembly, and build Indian mobile phone brands that can compete internationally
Key: Adds a separate incentive of up to 1.5 per cent tied to domestic sourcing, and creates a dedicated segment (TS2) for Indian-owned brands with no threshold sales volume
MPMS follows the PLI template - incentives paid on incremental or eligible sales rather than on capital investment - which the Government has extended across sectors from pharmaceuticals to white goods.
Electronics is among India's largest import categories; the localisation-linked incentive is aimed at converting assembly volumes into genuine import substitution.
Camera modules, display assemblies and battery cells are the components MPMS wants localised, which links it to the wider push on component and semiconductor manufacturing.
A standard instrument in Indian scheme design - an inter-ministerial body that selects beneficiaries and can adjust scheme parameters without a fresh Cabinet approval.
GS Paper 3 > Indian Economy - Government policies for industrial growth, effects of liberalisation on industry
General Awareness > Government schemes and the economy
General Awareness > Economy and Schemes
General Awareness > Current Affairs
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Mobile Phone Manufacturing Scheme - a five-year, Rs 62,500 crore MeitY incentive scheme for mobile phone manufacturing and Indian mobile brands, running FY 2026-27 to FY 2030-31.
An incentive paid as a percentage of eligible or incremental sales of goods made in India, as opposed to a capital subsidy paid on investment.
Electronics Manufacturing Services company - a contract manufacturer that builds products for brands rather than selling under its own name.
The share of a product's value actually created within the country, as against the value of imported parts merely assembled here.