The Union Cabinet has approved a new ₹62,500 crore mobile phone manufacturing scheme, marking a significant follow-up to the initial Production Linked Incentive (PLI) program that helped establish India as a global smartphone assembly hub. This five-year initiative, running from fiscal year 2027 to 2031, aims to shift the industry focus from simple assembly to deeper domestic value addition, local component sourcing, and the development of indigenous mobile brands. Alongside this, the government cleared the ₹1.27 lakh crore Semicon 2.0 mission, which seeks to build a comprehensive semiconductor ecosystem by supporting chip design, research, and local intellectual property development.
Under the new mobile scheme, manufacturers will receive incentives ranging from 2.25% to 5% on eligible sales. To encourage a more robust supply chain, the government has introduced an additional incentive of up to 1.5% for companies that source key components and sub-assemblies domestically. Furthermore, Indian brands will be eligible for an extra 3% incentive specifically tied to product design and research and development efforts. These measures are designed to help India move up the global electronics value chain, building on the success of the previous PLI-LSEM scheme which concluded in March 2026.
The government expects this policy push to generate cumulative mobile phone production worth approximately ₹39 lakh crore and exports of ₹15 lakh crore over the next five years. Officials also project the creation of 60,000 direct jobs, further strengthening the country's electronics manufacturing sector. By integrating the mobile manufacturing push with the expanded semiconductor mission, India aims to secure greater technological sovereignty and reduce its reliance on imported electronics and chips. The next steps involve the release of detailed operational guidelines within the coming fortnight to help companies align their investment plans with these new incentives.