Can the Government of India Give Us Its Own Global Smartphone Brand Like Apple or Samsung Through the MPMS Policy? Let's Find Out.
By Sachin Bhardwaj | Independent Strategic Advisor | Public Policy | Urban & Rural Development
Introduction: Beyond Assembly, Towards 'Tech Ownership'
Over the past few years, India has achieved historic success in electronics and mobile phone manufacturing. Driven by the successful implementation of the Central Government's flagship Production Linked Incentive (PLI) scheme for mobile phones, India has established itself among the leading mobile phone manufacturing hubs globally. The success of the PLI scheme in India has witnessed a surge in foreign direct investment, the creation of millions of direct and indirect jobs and record-breaking mobile phone exports.
To accelerate this momentum further and build upon the PLI scheme's foundation, the Ministry of Electronics and Information Technology (MeitY) has outlined the new Mobile Phone Manufacturing Scheme (MPMS).
However, a deep policy analysis of the PLI scheme and current manufacturing models reveals a stark reality: we currently remain trapped in an 'Assembly Trap'.
While we are assembling mobile components in India through Semi-Knocked Down (SKD) and Completely Knocked Down (CKD) assembly, the intellectual property (IP), software, operating system (OS), camera algorithms and user data of the smartphones used by Indian citizens remain under the control of foreign companies.
If India is to move beyond merely "Made in India" assembly under the Production Linked Incentive framework and realize the vision of "Designed, Developed, Engineered and Owned in India," the government needs to introduce a visionary and strategic shift in its MPMS policy.
1. What is the 'Assembly Trap' and Where Does a Smartphone's True 'Value' Lie?
While the PLI scheme for large-scale electronics manufacturing successfully operationalized assembly factories across India, an analysis of the total economic and technological value chain of a modern smartphone reveals that hardware assembly (assembling parts and packaging) contributes merely 10% to 15% of the total value.
The remaining 85% of the value lies in the following four core components:
- Intellectual Property (IP) and Patents (30-35%): 5G/6G Standard Essential Patents (SEPs), system architecture and AI software patents.
- Indigenous Operating System (OS) & UI/UX (20-25%): User interface, operating system, system software and cloud ecosystem.
- Camera R&D and AI Computational Photography (15-20%): Camera ISP tuning, sensor optimization and imaging algorithms.
- Data Sovereignty & Cybersecurity (10-15%): On-shore data storage, private servers and continuous security updates.
Smartphone Value Chain Architecture
Under the current PLI scheme model, the Indian smartphone industry has largely mastered only the 10-15% low-value assembly segment. As a result, domestic Indian brands have virtually vanished from the market, while foreign brands control over 85% of the Indian mobile landscape.
2. What Policy Shift is Needed in MPMS? The "Super-Incentive" Masterstroke
Under traditional manufacturing schemes like the PLI for mobile phones, financial incentives are primarily awarded based on Capex (production volume and factory infrastructure investment). The drawback of this model is that companies often import Semi-Knocked Down components, assemble them in India and claim government subsidies without building true technological capacity or IP ownership.
Policy Recommendation:
Instead of disbursing incentives under the new MPMS scheme solely based on production volume, the government should introduce a dedicated "R&D, IP and Software Support Incentive Vertical".
Strategic Proposal: If an Indian smartphone manufacturer, instead of delivering generic stock Android or re-branding foreign OS layers, develops a feature-rich, indigenous AOSP-based UI/OS in India; mandatorily stores 100% of user data within India; conducts in-house camera R&D; and provides long-term software support (4+ years), it should be granted special "Super-Incentives" significantly higher than standard PLI manufacturing incentives.
3. Five Strategic Pillars to Establish a World-Class Indian Brand
Pillar 1: Indigenous AOSP-Based UI & 100% Data Localization
When domestic Indian brands previously competed in the market, they mostly offered plain, uninspired stock Android experiences lacking advanced features. In contrast, foreign competitors captured consumers with feature-rich, customized user interfaces (such as Samsung's One UI or Xiaomi's HyperOS).
- Clean and Feature-Rich Experience: The government should incentivize companies to leverage the Android Open Source Project (AOSP) to build a world-class, bloatware-free, secure and intuitive indigenous UI.
- 100% Data Sovereignty: Cloud backups, system logs and personal user data must mandatorily be stored and processed exclusively inside data centers located within India.
- Accessibility Across 22 Official Languages: Deep integration of voice-first navigation and native typing/text support across all 22 scheduled Indian languages.
Pillar 2: Camera, ISP and AI Computational Photography Mission
For Gen-Z consumers and digital content creators today, camera performance is the single most important criterion when purchasing a smartphone.
- Foreign brands invest millions of dollars in developing imaging algorithms specifically calibrated for local lighting conditions and Indian skin tones.
- Due to limited R&D budgets, Indian mobile brands have historically lagged behind in camera processing capabilities.
- Policy Solution: Under the MPMS, the government should institute a National Mobile Imaging & AI Mission in collaboration with premier academic institutions like IITs, IIITs, C-DAC, IISc and NID. When an Indian smartphone produces exceptional photos and videos optimized for platforms like Instagram, YouTube and short-video content, youth consumers will naturally choose an Indian brand.
Pillar 3: Mandatory Long-Term Software Support & E-Waste Reduction
A major pain point for consumers buying budget smartphones is that manufacturers abandon software updates within 6 to 12 months. This leaves devices vulnerable to cyber threats, causes system lag, breaks banking app security and forces premature device replacement, generating massive electronic waste (E-waste).
- Mandatory Baseline Standard: Receiving incentives under the MPMS should be conditional on providing at least 2 major OS version updates and 3 years of regular security updates for every eligible smartphone model.
- Bonus Incentives: Companies that offer 4+ major OS version updates and 5+ years of regular security patches should receive additional financial weightage.
Pillar 4: Strict CERT-In Audits to Prevent Mere Re-branding
In the past, some companies attempted to claim government subsidies under manufacturing schemes by simply placing their logo onto foreign software or importing pre-configured Original Equipment Manufacturer (OEM) devices (Re-branding).
To prevent this:
- Independent code audits must be mandated through MeitY and CERT-In empanelled security auditors to verify codebase provenance and original software architecture.
- Incentives should be released only after third-party technical verification confirms genuine domestic software engineering and intellectual property creation.
4. Proposed 'IP Score' Framework for MPMS Incentives
Incentive disbursement under MPMS should transition away from pure unit volume used in early PLI schemes to an IP Score Framework (100-Point Architecture):
| Evaluation Parameter | Proposed Weightage |
|---|---|
| Indigenous AOSP-Based Feature-Rich UI (In-house developed, re-brand free) | 25% |
| 100% Data Localization (Data mandatorily stored and processed in India) | 20% |
| Camera R&D & AI Computational Photography Innovation | 20% |
| Indian Patents (SEPs) & Software Copyright Registrations | 15% |
| Long-Term Software Support Commitment (4+ OS & 5+ Years Security Updates) | 10% |
| R&D Team Size & Partnerships with Academic Institutions (IITs/IISc) | 10% |
| Total IP Framework Score | 100% |
5. Implementation Roadmap: From PLI to Global Tech Leadership
Incorporate indigenous OS, camera R&D and mandatory software support guidelines into MPMS.
Establish CERT-In software audit protocols, code provenance frameworks and academic R&D networks.
Disburse Super-Incentives based on the IP Score Framework and launch globally competitive Indian brands.
Conclusion: From Manufacturing Assembly to Technology Ownership
The PLI scheme for electronics manufacturing has proven that India can assemble complex electronic hardware at a global scale. However, remaining a contract assembler under basic assembly incentives cannot be the final destination.
The ultimate strategic goal must be Global Technology Ownership.
If the Government of India prioritizes software innovation, domestic R&D, camera algorithms, data security and long-term consumer trust within the new MPMS policy, India will not only safeguard its domestic market from foreign reliance but also give the world its first world-class, premium and trusted global smartphone brand.
About the Author
Sachin Bhardwaj is an independent strategic advisor specializing in public policy, experience strategy and digital transformation. This article is adapted from policy recommendations submitted to the Ministry of Electronics and Information Technology (MeitY) regarding the Mobile Phone Manufacturing Scheme (MPMS), by Sachin Bhardwaj.