ISM 2.0, mobile manufacturing scheme unveiled: Strong push by government on driving electronics manufacturing and localization in India

Research evidence excerpt

ISM 2.0, mobile manufacturing scheme unveiled: Strong push by government on driving electronics manufacturing and localization in India

Global Markets Research

16 July 2026India EMS

EQUITY: CONSUMER RELATED

ISM 2.0, mobile manufacturing scheme unveiled Research Analysts

India Consumer Durables

Strong push by government on driving electronics Siddhartha Bera, CFA - NFASL

siddhartha.bera@nomura.commanufacturing and localization in India

+91 22 403 74362

Cabinet approves INR1.89tn (~USD20bn) outlay across ISM 2.0 and mobile phone Kapil Singh - NFASL

manufacturing schemes over next five years kapil.singh@nomura.com

+91 22 403 74199 • The India Union cabinet today approved (link, link) two schemes in a push to sustain the

strong traction in the electronics manufacturing ecosystem, drive localization and improve India’ Tisha Mandavia - NFASL

s position in the global semiconductor supply chain. tisha.mandavia@nomura.com

+91 22 403 74034

• The schemes include the India Semiconductor Mission (ISM 2.0) with an outlay of INR1.27tn

(~USD13.2bn). Under ISM 2.0, the support is more broad-based across six pillars – chip

design, machinery and raw materials for chip manufacturing, chip fabrication (across silicon,

compound, display fabs, etc), advanced packaging, R&D on advanced nodes, and talent

development.

• The Mobile Phone Manufacturing Scheme (MPMS) was also approved with an outlay of

INR625bn (~USD 6.5bn) over five years (FY27 to FY31). This is targeted to scale up the

production of mobiles, deepen domestic value addition and enhance global competitiveness.

• The scheme provides incentive support ranging from 2.25% to 5% on eligible sales for

manufacturing mobile phones in India and an additional incentive of up to 1.5% linked to