Government Eyes to Extend or Revamp Mobile Manufacturing PLI Scheme

The government is weighing options to sustain momentum in India’s mobile phone manufacturing ecosystem as the current production-linked incentive (PLI) scheme nears its end, as per news reports. 

Policymakers are assessing whether an extension or a redesigned incentive programme is needed to preserve recent gains and address remaining cost disadvantages in the sector. 

Key Development 

The existing ₹40,995 crore mobile phone PLI scheme is scheduled to conclude in March. Officials indicated that no final call has been taken yet, either on continuation or on the size of any future incentives.  

According to Ministry of Electronics and Information Technology secretary, S. Krishnan, some structural challenges in mobile electronics manufacturing persist, even though competitiveness has improved markedly over the past few years. 

Policy Rationale and Industry Feedback 

The mobile PLI, launched in April 2020, offered incentives of 4-6% on incremental sales of domestically produced handsets and accounted for roughly one-fifth of the total outlay across all PLI schemes.  

Government assessments suggest that while component localisation is improving, newer initiatives such as the Electronics Component Manufacturing Scheme will take time potentially 2 years or more to materially reduce costs. 

Impact on Manufacturing and Exports 

Data shared earlier by the government show that incentive disbursements between FY22 and FY25 amounted to ₹8,700 crore, with the bulk going to a handful of large manufacturers.  

The scheme has been instrumental in expanding India’s electronics manufacturing services base, pushing sector revenues past ₹1.25 trillion in FY24. 

Over the longer term, mobile manufacturing capacity has expanded sharply, with the number of production units rising from just 2 a decade ago to around 300 by March 2025. In FY25, electronics production reached ₹11.3 trillion, while exports stood at ₹3.27 trillion. 

Read More: India’s Electronics Sector Adds 1.33 Million Jobs as PLI Drives Manufacturing and Exports! 

Conclusion 

As the current PLI window closes, the Centre’s decision on extending or redesigning incentives will be critical in determining whether India can consolidate its position as a global mobile manufacturing hub and sustain export-led growth in electronics. 

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