India is pouring billions into smartphone manufacturing incentives, aiming to pull more of the global electronics supply chain away from China. The new program builds on the country's success assembling Apple's iPhones. Main Developments New Delhi launched the Mobile Phone Manufacturing Scheme on Wednesday, a ₹625 billion ($6.5 billion) program running for five years. It rewards manufacturers based on eligible sales, offering incentives from 2.25% to 5%, plus an extra 1.5% for sourcing key components locally. The government also committed ₹1.28 trillion ($13.3 billion) to bolster domestic semiconductor manufacturing. This expands a $10 billion chip incentive program launched in 2021 with added support for equipment, materials, design, and research. Read also: U.S. charges Russian web hosts in $62M cybercrime spree Background India has steadily grown its electronics manufacturing sector, particularly through assembling iPhones for Apple. The new incentives aim to deepen that success by encouraging more companies to shift production from China, where geopolitical tensions and supply chain risks have pushed firms to diversify. Why It Matters These moves could reshape global electronics supply chains, reducing reliance on China for smartphone and chip production. For India, it means jobs, investment, and a stronger position in high-tech manufacturing, while companies gain a more stable alternative sourcing hub. What's Next The five-year incentive scheme will begin rewarding sales immediately, with manufacturers expected to ramp up local production and component sourcing. The expanded semiconductor push may attract more chip design and fabrication firms to India over time.