PIB TrackerIndia's new phone scheme pays a premium for owning the brand
MeitY has notified the ₹62,500 crore Mobile Phone Manufacturing Scheme, with a separate segment paying 5% to Indian brands, 3% more for Indian design and R&D, and an ownership test to match.
What happened
- MeitY notified the Mobile Phone Manufacturing Scheme with an outlay of ₹62,500 crore.
- The tenure is five years, from FY 2026-27 to FY 2030-31.
- TS1 pays 2.25% to 5%; TS2 pays 5% to Indian brands plus 3% for Indian design and R&D.
- An additional 1.5% is available for domestic sourcing at 25% localisation of units.
- Expected outcomes are about ₹39 lakh crore of production and around 60,000 direct jobs.
For Prelims
- MPMS: the Mobile Phone Manufacturing Scheme of MeitY — outlay ₹62,500 crore, tenure FY 2026-27 to FY 2030-31.
- Two segments: TS1 incentivises mobile phone manufacturing; TS2 supports Indian mobile phone brands.
- Indian Brand test: incorporated in India, IP and trademark held in India, management control with Indian citizens, more than 51% Indian shareholding, in-house R&D and design in India.
- Entry thresholds: TS1 needs FY 2025-26 turnover of ₹10,000 crore; TS2 needs ₹1,000 crore.
- Incremental sales test: existing brands must add ₹5,000 crore a year over FY 2025-26 sales; a new brand qualifies only after ₹10,000 crore of annual India sales.
- Localisation bonus: up to 1.5% where key components are localised for at least 25% of units made in a financial year.
- Predecessor: PLI-LSEM — the PLI for Large Scale Electronics Manufacturing — whose tenure ended on 31 March 2026.
- Position: India is the second largest mobile phone manufacturer by volume; 99.2% of phones used in India are made here, and smartphones were India's largest export category in 2025.
For UPSC: The clearest instance yet of industrial policy moving from volume to ownership of intellectual property. Use it for PLI design, domestic value addition and the difference between where a product is assembled and who owns it.
What it is NOT: Notification is not disbursement — and an India-registered contract manufacturer does not become an 'Indian brand' under the scheme unless the IP, management control and majority shareholding are Indian.
For Mains
Syllabus: GS3.8 · GS3.12 · Linkage L2
Anchor
India assembles almost every phone it uses and owns almost none of the designs; the second segment of this scheme is an attempt to buy the missing layer.
Substantiation (data)
₹62,500 crore over five years; 2.25-5% for manufacturers, 5% plus 3% for Indian brands and design, up to 1.5% for 25% localisation; about ₹39 lakh crore of production and 60,000 jobs expected.
Exemplification
Smartphones became India's single largest export category in 2025, ahead of diesel fuel and cut diamonds — scale that PLI-LSEM built without an Indian brand emerging from it.
Problematisation
A ₹10,000 crore turnover floor and a ₹5,000 crore annual increment confine TS1 to incumbents, and verifying that intellectual property is genuinely Indian-owned is an evaluation problem before it is a manufacturing one.
Way-forward
Publish brand-wise incentive claims and the criteria used to test Indian ownership of IP, so both the increment threshold and the Indian Brand test are auditable.
Position
Value addition is counted in patents and brand ownership, not in the share of handsets stamped Made in India.
Deploys into: Industrial policy + indigenisation (GS3.8, GS3.12) · PLI design, domestic value addition and the shift from assembly scale to owned intellectual property.
Ministry of Electronics & IT · 2026-08-21 · PRID 2302098 · PIB source ↗