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Mobile Phone Manufacturing Scheme (MPMS) Approved by Union Cabinet

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On 15 July 2026, the Union Cabinet approved the Mobile Phone Manufacturing Scheme (MPMS) with a budgetary outlay of ₹62,500 crore. The scheme will run for five years from FY 2026-27 to FY 2030-31 and replaces the Production Linked Incentive Scheme for Large Scale Electronics Manufacturing, which ended on 31 March 2026. MPMS aims to enhance mobile phone production in India, increase domestic sourcing of components, promote research and development linked to Indian brands, and strengthen the electronics supply chain. It targets cumulative production worth ₹39 lakh crore and exports valued at ₹15 lakh crore over its tenure, along with generation of approximately 60,000 direct jobs.

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Key Facts

  • Approval Date: 15 July 2026
  • Scheme Duration: Five years covering FY 2026-27 to FY 2030-31
  • Budgetary Allocation: ₹62,500 crore
  • Replaces: Production Linked Incentive Scheme for Large Scale Electronics Manufacturing which concluded on 31 March 2026
  • Incentive Structure: 2.25% to 5% on eligible sales of mobile phones manufactured in India
  • Additional Incentives: Up to 1.5% for domestic sourcing of key components and sub-assemblies; additional 3% for product design and Research and Development linked to Indian brands and indigenous innovation
  • Expected Cumulative Production Value: Around ₹39 lakh crore over five years
  • Projected Export Value: Approximately ₹15 lakh crore over five years
  • Employment Generation: Estimated direct jobs about 60,000

Background & Context

The Mobile Phone Manufacturing Scheme (MPMS) is part of India's strategic push to scale up domestic electronics manufacturing, particularly in the mobile phone sector, enhancing India’s global competitiveness in electronics. It follows the conclusion of the earlier Production Linked Incentive Scheme for Large Scale Electronics Manufacturing, aiming to deepen domestic value addition, encourage indigenous design and R&D, and promote supply chain resilience. The scheme incentivizes manufacturing with increasing emphasis on local sourcing and innovation aligned with Indian brands, contributing to the objectives of the Make in India initiative and reducing import dependence.

Why This Matters for Exams / Exam Relevance

The MPMS is a significant recent government policy framework relevant for questions on industrial development, manufacturing incentives, and government schemes in competitive exams. Key aspects such as scheme duration, budget, incentive rates, dates of approval and operational period, objectives, and expected outcomes like production, exports, and employment figures are important factual points. Moreover, it brings insights into India's evolving electronics manufacturing policies, sectoral growth strategies, and efforts to enhance R&D and domestic innovation, making it an essential topic in economy and governance sections.

Points to Remember

  • MPMS was approved by the Union Cabinet on 15 July 2026 with a ₹62,500 crore budget.
  • The scheme replaces the Production Linked Incentive Scheme for Large Scale Electronics Manufacturing that ended on 31 March 2026.
  • It operates for five fiscal years from 2026-27 to 2030-31.
  • Incentive rates on eligible sales range from 2.25% to 5%, plus up to 1.5% additional incentive for domestic component sourcing.
  • An extra 3% incentive is provided for product design and R&D linked with Indian brands and indigenous innovation.
  • The scheme targets cumulative production worth ₹39 lakh crore and exports about ₹15 lakh crore.
  • Direct employment generation expected is around 60,000 jobs over five years.
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