India’s smartphones story is moving to the next chapter. While the earlier PLI scheme launched made the country a significant global mobile manufacturing destination, the new 62,500 crore Mobile Phone Manufacturing Scheme (MPMS) by the Government is now putting the focus on Indian mobile brands, local value addition and technology development.
The new scheme, valid for five years from FY2026-27 to FY2030-31, provides incentives of 2.25% to 5% on eligible sales of mobile phones manufactured in India. Significantly, the intention behind the policy is to incentivise India companies to go up the value chain and create stronger design, R& D and global export capabilities.
India’s Mobile Manufacturing Gets a Major Push
India has already achieved a substantial level of local manufacturing in smartphones. The government estimates that 99.2% of all mobile phones (including feature phones) in India are now manufactured in India, and as such it is now the 2 nd largest mobile phone manufacturer in the world in terms of volume. Smartphones alone are the top individual export in India in FY2025-26.
The revamped PLI scheme for large scale electronics manufacturing was a significant factor in this. It has registered a cumulative investment of 20,587 crore till March 2026, compared with a target of 7,000 crore. The scheme has enabled production of 11.61 lakh crore while exports accounted for 6.43 lakh crore.
However, mobile manufacturing success thus far has been largely driven by global brands and contract manufacturers. India’s next challenge is to create global competitive home grown brands.
Why Indian Smartphone Brands Are Back in Focus
Domestic handset makers, including Lava, Micromax and others, found fierce competition coming from Chinese and other global entrants. The earlier PLI structure was also tough for many homegrown players due to high investment and production levels required.
This formula could be changed by the new Mobile Phone Manufacturing Scheme which has a focus on scale as well as Indian Brands, design prowess, R&D and Technological sovereignty.
This is a critical shift. India has demonstrated its ability to set up and run large-scale manufacturing plants for phones, but if an Indian brand is to succeed it will need to develop capabilities in product design, software, branding, distribution, innovation and access to the global markets.
From “Made in India” to “Designed in India”
The larger goal of the new mobile manufacturing policy is to increase the share of value created by each smartphone in India.
Government data has showed that domestic value addition in the electronics manufacturing sector has improved substantially however, a significant amount of high-value components is still being bought from outside. Hence the new policy is expected to promote more localisation and stronger domestic supply chain.
For Indian brands, this could mean an opportunity to create products that are not just assembled in India but also increasingly designed and engineered in India.
This may focus on investing in areas such as smartphone design, software, camera technology, AI features, chip integration and other high value areas.
Can Lava and Other Indian Brands Compete?
The key question is if Indian smartphone makers will be able to turn government support into a market share story.
It’s still competitive – Samsung and Apple and the Chinese players are well entrenched with their distribution channels, production bases and big marketing budgets. Third-party electronics producers like Dixon Technologies have gained ground as well.
In the case of Indian brands, perhaps the path to growth lies not just in battling for price points, but rather through finding gaps in the market. Possible opportunities include entry-level 5G smartphones, equipment for enterprise, software features specific to local requirements and differentiated products.
More robust domestic component supply chain might also lower manufacturing expenses and might help Indian brands compete internationally.
India’s Smartphone Export Opportunity
The new scheme could also bolster India’s standing as a world smartphone export center.
The previous policy on PLI helped a boost in the exports of mobile. Data from the government indicate that the exports of mobile phones increased from rupees 1, 500 crores in 2014-15 to nearly rupees 2 lakh crores by 2024-25.
Next, what we need to do is ensure that Indian brands are integrated into that export story.
If Indian firms are able to create competitive products and establish international distribution channels, over time India may evolve from the manufacturing bases of MNC brands into the origins of truly Indian globally accepted brands.
What the New PLI Scheme Means for Consumers
Ultimately, as the competition continues to strengthen between Indian and foreign brands, consumers may benefit from more options available to them.
More localisation might also boost after sales support, product availability and the ability to quickly respond to manufacturing shocks. However, the implications for phone prices will depend on how quickly component manufacturing grows and whether companies can attain economies of scale.
The new scheme is therefore not a short-term fix. It is a long-term endeavor to create an ecosystem of electronics manufacturing that retains greater value within the country.
The Road Ahead for Indian Mobile Brands
India has already proved itself in the manufacturing of phones at an immense scale. The real task now is to develop Indian intellectual properties, Indian brands and Indian technology on top of this manufacturing platform.
Mobile Phone Manufacturing Scheme of Rs62,500 crore is another bold policy push in that direction. How far the scheme is successful will depend on whether domestic firms will be able to invest in innovation, compete with global brands and convert manufacturing incentives into marketable products.
If it turns out that way, the next chapter in India’s mobile story might not be of the ‘Made in India’ variety. It could be Indian mobile companies taking on the world.
