Now Reading: Rs 62,500-crore mobile phone scheme targets domestic brands
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Rs 62,500-crore mobile phone scheme targets domestic brands
The government has notified a Rs 62,500-crore Mobile Phone Manufacturing Scheme (MPMS) aimed at deepening domestic value addition and nurturing Indian handset brands. The scheme runs for five years from this fiscal…
The government has notified a Rs 62,500-crore Mobile Phone Manufacturing Scheme (MPMS) aimed at deepening domestic value addition and nurturing Indian handset brands. The scheme runs for five years from this fiscal year and replaces the expired production-linked incentive (PLI) scheme for mobile phones.
Under the plan, mobile phone companies and contract manufacturers with a turnover of Rs 10,000 crore in FY26 are eligible for incentives. Indian-owned firms with at least 51% domestic equity and a turnover of Rs 1,000 crore in FY26 qualify for additional support. Benefits include 2.75% to 2.25% incentives on eligible sales for contract manufacturers, and 5% for majority-Indian brands.
The scheme targets doubling domestic mobile phone production by value to Rs 15 lakh crore from the current Rs 7.5 lakh crore. Industry bodies and consulting firms have welcomed the policy, saying it will strengthen component ecosystems and help local champions such as Lava compete against dominant Chinese brands and global players such as Apple and Samsung.
Indian Opinion Analysis
The MPMS replaces the production-linked incentive (PLI) scheme for mobile phones that expired in March 2025. The PLI scheme had successfully scaled production to about Rs 7.5 lakh crore annually, but critics argued it largely benefited contract manufacturers for global brands such as Apple and Samsung without meaningfully building domestic component supply chains or boosting homegrown handset brands. The new scheme’s tiered incentives, higher rates for Indian-owned firms that localise camera modules, display assemblies and battery cells, are designed to correct that imbalance. India’s mobile phone import bill has declined from Rs 80,000 crore in FY15 to near zero, but the domestic market, valued at roughly Rs 2.5 lakh crore annually, still sees Chinese brands such as Vivo and Xiaomi capture over 60% of sales. Lava remains the only significant Indian brand, with less than 5% market share. The scheme will begin accepting applications from this fiscal year (FY26), with the first incentive payouts likely due from FY27 onwards.
Source: telecom.economictimes.indiatimes.com
This story was synthesised by AI from the source linked above.
