Union Minister for Electronics and Information Technology Ashwini Vaishnaw has strongly defended the government's Production-Linked Incentive (PLI) scheme for mobile phone manufacturing, emphasizing that the economic returns have significantly outweighed the financial incentives provided by the state. Addressing concerns regarding the effectiveness of the current manufacturing model, the minister disclosed that the government has disbursed ₹19,000 crore in incentives under the scheme to date.
In a detailed breakdown of the program's fiscal impact shared on social media, the minister noted that these payouts have generated a substantial sum of ₹3.25 lakh crore in total tax contributions. This figure comprises approximately ₹25,000 crore in direct tax collections and ₹3,00,000 crore in Goods and Services Tax (GST). By highlighting these statistics, the government aims to underscore the net positive impact of the manufacturing initiative on the national exchequer.
Beyond the fiscal gains, the minister highlighted the considerable growth in employment opportunities within the sector. According to official figures, the broader electronics manufacturing industry currently provides employment to 25 lakh people across the country. Of this total workforce, mobile phone manufacturing alone accounts for 12 lakh jobs, reflecting the scheme's role in industrial scale-up and job creation.
The minister's statement follows a period of public discussion regarding the long-term viability of the government's incentive-based approach to electronics manufacturing. To maintain the momentum achieved under previous initiatives, the Union Cabinet recently approved the Mobile Phone Manufacturing Scheme (MPMS) with a budgetary outlay of ₹62,500 crore. This new policy is set to be implemented from the 2026-27 financial year through 2030-31, building upon the foundations laid by the recently concluded Production Linked Incentive Scheme for Large Scale Electronics Manufacturing.
The objectives of the upcoming scheme are multi-faceted. The government intends to further scale up domestic production, increase local sourcing of essential components, and strengthen India’s integration into global supply chains. By incentivizing both domestic value addition and research and development, the policy aims to enhance the global competitiveness of Indian mobile brands. Under the framework, eligible manufacturers receive incentives ranging between 2.25 percent and 5 percent on sales, with an additional 1.5 percent boost provided for the domestic sourcing of key components and sub-assemblies.
Projections from the Ministry of Electronics and Information Technology suggest that the total output of mobile phone production throughout the tenure of the new scheme is expected to reach approximately ₹39 lakh crore. Furthermore, officials anticipate a marked increase in exports as a result of these efforts. Beyond industrial targets, the ministry projects that the scheme will facilitate the creation of an additional 60,000 direct jobs within the sector.
As the government moves forward with this strategy, the focus remains on sustaining the growth of Indian brands while deepening the local manufacturing ecosystem. The transition from the previous iteration of the PLI scheme to the new MPMS framework marks a strategic shift intended to move beyond assembly and toward more comprehensive domestic value creation. With the latest financial data in hand, the government maintains that the investment in industry incentives remains a vital catalyst for India's transition into a global electronics manufacturing hub.
Comments