India has seen a significant boost in its mobile phone industry, gaining ₹3.25 lakh crore from the sector, according to Union Electronics and IT Minister Ashwini Vaishnaw. This revenue comes in exchange for the ₹19,000 crore in incentives provided under the mobile production-linked incentive (PLI) scheme.
Data released by Vaishnaw on Wednesday highlights the financial impact of the scheme. The government received ₹25,000 crore as direct tax and ₹3 lakh crore in Goods and Services Tax (GST) from companies benefiting from the incentives. The minister's statement was a response to criticism suggesting that India's subsidy-driven approach to electronics manufacturing is less effective compared to China's established ecosystem.
India's mobile phone exports reached ₹2 lakh crore in the fiscal year 2025, while imports have dwindled to a mere 0.02% of domestic demand in 2024-25, a sharp decline from 75% a decade ago. This shift underscores the country's growing self-reliance in mobile phone production.
The production of electronic goods in India has surged sixfold, reaching approximately ₹11.3 lakh crore in 2024-25, up from ₹1.9 lakh crore in 2014-15. Mobile phone production alone has seen a dramatic increase to ₹5.5 lakh crore from ₹0.18 lakh crore over the same period. Meanwhile, exports of electronic goods have risen eightfold, amounting to ₹3.3 lakh crore in 2024-25 compared to ₹0.38 lakh crore ten years ago.
The government has introduced the Mobile Phone Manufacturing Scheme (MPMS), which allocates ₹62,500 crore in incentives to further enhance local production. The scheme aims to foster the development of Indian smartphones, designed and manufactured domestically. Vaishnaw has set a goal to establish an Indian smartphone brand by October 2028.
In his social media post, Vaishnaw emphasized the employment impact of the electronics manufacturing sector, which employs 25 lakh people, with 12 lakh jobs in mobile manufacturing alone. His comments were directed at addressing concerns about the cost-effectiveness of the subsidies, particularly in light of the ongoing debate about the import of components versus the export of finished mobile phones.
The minister's remarks come amid discussions on the long-term sustainability of India's electronics manufacturing strategy. Critics argue that the cost of importing components might outweigh the benefits of exporting subsidized finished products. However, the government's data suggests that the incentives have successfully stimulated growth and reduced dependency on imports.
