India no longer wants to remain just a country that assembles mobile phones for the world, but is preparing to become a global center for designing and developing them. Under this goal, the Central Government has approved a new Mobile Phone Manufacturing Scheme (MPMS) worth Rs 62,500 crore. This scheme will be applicable from financial year 2027 to 2031 and its focus will be not only on mobile assembly, but on component manufacturing, research, design and increasing domestic value addition. The government aims to generate production worth Rs 39 lakh crore, exports worth Rs 15 lakh crore and 60,000 direct employment through this scheme. In such a situation, the biggest question is whether this plan will be able to make India a strong alternative to China. Let us understand.
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What will change in the new Rs 62,500 crore scheme?
The biggest difference of the government’s new Mobile Phone Manufacturing Scheme (MPMS) is that now the emphasis will not be only on connecting mobiles. The government wants expensive mobile parts like PCB, camera modules, displays, sub-assemblies and other electronic components to be made in India. This is the reason why a budget of Rs 62,500 crore has been fixed for five years. Under the scheme, companies will get incentives ranging from 2.25 to 5 percent on eligible sales. If companies use components made in India, an additional incentive of 1.5 percent will be given. For the first time, a separate incentive of 3 percent has also been kept for research, design and R&D. So that more and more companies focus on product design in India. Its objective is to transform India from an assembly center to a technology development center.
Why is ‘Design in India’ important?
- Separate incentive on R&D for the first time
- New designs will be made in India
- Indian engineers will develop new technology
- Dependence on foreign patents will reduce
- India will become design and innovation hub
Where did the old PLI take India?
India’s biggest success in the field of mobile manufacturing was the old Production Linked Incentive (PLI-LSEM) scheme. Thanks to this scheme, India emerged from a mobile importing country to the world’s second largest mobile manufacturing country. According to government data, mobiles worth about Rs 18 thousand crore were manufactured in the country in 2014-15, which will increase to about Rs 5.5 lakh crore by 2024-25. At the same time, mobile exports increased from Rs 1 thousand crore to about Rs 2 lakh crore. Smartphones became India’s largest single export product in the year 2025, overtaking traditional export products like diesel and cut diamonds. In the reply given by the Ministry of Electronics and Information Technology in the Lok Sabha, this transformation has also been counted among the biggest manufacturing achievements of India.
How will the target of Rs 39 lakh crore production and 60 thousand jobs be achieved?
The government estimates that this scheme will generate mobile production worth about Rs 39 lakh crore in its entire tenure. Out of this, a target has been set to export mobile and electronics products worth about Rs 15 lakh crore. The scheme is expected to generate about 60 thousand direct employment. The demand for engineers, technicians, assembly workers and R&D specialists will increase as companies like Foxconn, Tata Electronics, Dixon and others set up new factories and expand existing units. Apart from this, there is a possibility of creation of a large number of indirect employment in supply chain, logistics and service sector.
When 99.2% of mobiles are made in India then why is there a need for a new scheme?
At first glance this question seems natural because about 99.2 percent of the mobiles used in India are already being made in the country. But the real challenge is not production but value addition. Currently, India’s contribution to a Rs 100 mobile phone is considered to be only Rs 15 to Rs 20, while the remaining expensive parts are imported from abroad. The government wants to take the value addition to 35 to 40 percent through this new scheme. This means that in future, not only the final assembly of the mobile but also a major part of it will be prepared in India. This will reduce dependence on imports and will bring more profits and technology to the country.
What will be the impact on Apple, Samsung and China?
The biggest benefit of the new scheme will be given to those global companies which are already producing in India. Apple is rapidly increasing production in India through its suppliers Foxconn, Tata Electronics and other partners. Samsung has also set up a large manufacturing base in India. Now, with additional incentives on local sourcing, global suppliers of these companies will also be motivated to set up factories in India. This will develop the entire electronics ecosystem. The government’s strategy is to take advantage of the China Plus One model so that companies from all over the world can make India a major manufacturing center along with China.
Is India in a position to compete with China?
Today, India has become the second largest mobile phone manufacturer in the world, but China is still far ahead in terms of total production, component manufacturing and exports. Now mobile phones worth more than Rs 5.5 lakh crore are being manufactured annually in India and in 2025, smartphones will become the country’s largest single export product. Under the new MPMS scheme, a target of mobile production worth Rs 39 lakh crore and export of Rs 15 lakh crore has been set in the next five years. On the other hand, China’s electronics manufacturing ecosystem is still the world’s largest and it exports hundreds of billions of dollars worth of smartphones and electronics every year. However, due to the ‘China Plus One’ strategy of many global companies including Apple, India is rapidly increasing its share. By July 2026, about 25 percent of the world’s iPhones will be manufactured in India and iPhone exports from India have crossed the record level of Rs 2 lakh crore. If component manufacturing, design and research are also strengthened in India through the new scheme, then in the coming years India can emerge not only as an assembly hub but also as an alternative to China.
India vs China: Mobile Manufacturing
| parameters | India | China |
| global rank | Second largest mobile manufacturer | First largest mobile manufacturer |
| iPhone production (2026) | About 25% of the world’s iPhones | about 75% iPhone |
| iPhone assembly in 2025 | 5.5 crore units | largest production center |
| mobile export | about Rs 2 lakh crore | highest in the world |
| value addition | 15-20% | 60-70%+ (estimated industry level) |
| component manufacturing | growing rapidly | Complete supply chain present |
| chip manufacturing | initial phase | global ecosystem |
| government’s focus | Design in India, Component Manufacturing, R&D | Maintaining the lead in high tech manufacturing |
iPhones made in India going worldwide
India is now becoming not just a manufacturing base but a global production hub for Apple. By July 2026, India is producing about 25 percent of the world’s total iPhone production. That means every fourth iPhone sold in the global market is now being made in India. In the year 2025, about 5.5 crore (55 million) iPhones will be assembled in the country, while the export of iPhones made in India has crossed the historical level of Rs 2 lakh crore (about 24 billion dollars). Foxconn and Tata Electronics are Apple’s major manufacturing partners. Not only this, the company is also producing its iPhone 17 series, which also includes premium Pro and Pro Max models, in India. The government has also abolished 5 to 7.5 percent import duty on smartphone components from July 9, 2026, which is expected to reduce production costs and increase investment in India. This can also give a big boost to the new Rs 62,500 crore mobile manufacturing scheme.
Why is ‘Design in India’ the biggest feature of this scheme?
Till now India mainly manufactured mobile phones designed by foreign companies. The design, patents and intellectual property of mobile phones remained with foreign companies. For the first time in the new scheme, a separate 3 percent incentive has been given for design and research. Its objective is to encourage Indian engineers and companies to develop their mobile, hardware, software integration and new technologies. The government wants that in the future, India should not only become a manufacturing center but also a global design and innovation hub. This change will go beyond ‘Made in India’ and strengthen the thinking of ‘Design in India’.
Also read: Top 10 countries of the world where people use phones the most, know at which number India is?
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