Cabinet Approves Mobile Phone Manufacturing Scheme (MPMS) with ₹62,500 Cr Outlay
UPSC / SSC current affairs note · Economy
Why in news
The Union Cabinet, chaired by PM Modi, has approved the Mobile Phone Manufacturing Scheme (MPMS) with a budgetary outlay of ₹62,500 crore for five years (FY2026-27 to FY2030-31). This scheme aims to boost domestic production, value addition, and exports, building on the success of the PLI scheme for large-scale electronics manufacturing.
Background
Under the 'Make in India' vision, electronics manufacturing has grown 7 times and exports 11 times since FY2014-15. India is now the world's second-largest mobile phone manufacturer, with 99.2% of mobile phones used domestically being manufactured locally. In 2025, smartphones emerged as India's top export product, surpassing diesel and cut diamonds.
Key facts
MPMS approved with a budgetary outlay of ₹62,500 crore for five years (FY2026-27 to FY2030-31).
Incentive rates: 2.25% to 5% on eligible sales for mobile phone manufacturing in India.
Additional incentive of up to 1.5% for domestic sourcing of key components/sub-assemblies.
Extra 3% incentive on eligible sales for product design and R&D to promote Indian brands.
Expected total mobile phone production of ~₹39,00,000 crore during the scheme period.
Estimated direct employment generation of about 60,000 jobs.
India is the world's second-largest mobile phone manufacturer; 99.2% of domestic mobile phones are made in India.
In 2025, smartphones became India's top export product, surpassing diesel and cut diamonds.
The earlier PLI for Large Scale Electronics Manufacturing (PLI-LSEM) ended on March 31, 2026.
The scheme aims to achieve technological sovereignty, create Indian patents in design and R&D.
Prelims pointers
- Scheme: Mobile Phone Manufacturing Scheme (MPMS)
- Outlay: ₹62,500 crore
- Duration: FY2026-27 to FY2030-31 (5 years)
- Incentive: 2.25% to 5% on eligible sales
- Additional incentive: up to 1.5% for domestic sourcing of key components
- Design & R&D incentive: 3% on eligible sales for Indian brands
- Expected production: ~₹39,00,000 crore
- Expected direct employment: ~60,000
- India: world's second-largest mobile phone manufacturer
- Domestic manufacturing share: 99.2%
Mains angles
- GS3: Industrial policy – Discuss the role of production-linked incentives in boosting manufacturing and exports.
- GS3: Employment – Evaluate the potential of schemes like MPMS in generating direct and indirect employment.
- GS3: Technology – Examine how MPMS can help achieve technological sovereignty and promote R&D in electronics.
- GS2: Government policies – Critically analyze the effectiveness of 'Make in India' in transforming India into a global manufacturing hub.