Your iPhone is “Made in India.” About 82% of its value isn’t.
India’s flagship smartphone PLI scheme — the subsidy programme that turned the country into a phone-making powerhouse — expires this month. The 2026 replacement changes the rules entirely.
The Scorecard
The original scheme delivered staggering numbers. India produced nearly $60 billion worth of mobiles in FY 2024-25 — a 28-fold jump over a decade. Exports hit $21.70 billion, a 127-fold increase that made smartphones India’s single largest export product. Mobile imports dropped 77% since 2020-21. Over 99% of domestic demand is now met locally — connecting to a 5G rollout reaching 773 districts.
Those are world-class assembly numbers. The problem: domestic value addition stayed around 18%. The chips, displays, and camera modules — the expensive parts — still come from abroad. The government paid 4-6% incentives for companies to put phones together. Not to actually make them.
What the 2026 Smartphone PLI Scheme Changes
PLI 2.0 rewrites the incentive structure. Instead of rewarding incremental production volume, the new scheme links subsidies to exports and locally sourced components. Apple and Samsung manufacturing in India remains the primary focus — but they’ll need to source more parts domestically to collect.
The push has budget muscle behind it. The Electronics Components Manufacturing Scheme got Rs 40,000 crore in the 2026-27 Budget, targeting exactly the gap PLI 1.0 left open. The broader ambition: $500 billion in electronics manufacturing by FY 2030, up from the current trajectory. India’s semiconductor mission feeds into the same playbook — from assembly line to supply chain.
Will Your Phone Get Cheaper?
Probably not — at least not soon. Smartphone export incentives in India go to manufacturers, not consumers. Whether local component sourcing lowers retail prices depends on whether savings get passed on or absorbed into margins. Historically, they’ve gone to margins.
The real test arrives in five years. If the smartphone PLI scheme 2.0 for mobile phones works, the percentage of your phone that’s actually Indian-made should climb well past 18%. If it doesn’t, India will have spent another decade as the world’s most impressive assembly line — and not much else.
Sources: Reuters, Policy Circle, Economic Times, Moneycontrol