New Report Claims India’s Phone Assembly Domestic Value Addition Reaches 23%, Surpassing Previous Estimates
NEW DELHI, India—July 24, 2025: The newly released report by the Centre for Development Studies (CDS), Thiruvananthapuram, claims that the domestic value addition (DVA) in mobile phones assembled and manufactured in India has gone up substantially to 23% of the total production value in the year 2022-23. Earlier assessments remained quite skeptical about the possibility of domestic value addition going beyond single digits and thus indicating a rather healthy and self-sufficient ecosystem that was not seen earlier.
Challenged Earlier Notions
The same report, of which Dr. C. Veeramani is the director of the CDS and RBI Chair Professor, also showed that India is not into low-value assembly, where most parts come from outside, in terms of making mobile phones. The report’s findings were revealed during a meeting called by the India Cellular and Electronics Association (ICEA) by Dr. Veeramani, and he stated the actual-used-imported components in mobile phones were below 25% based on figures from the Annual Survey of Industries (ASI).
Incredible Growth in Domestic Value Addition
The direct domestic DVA sources increased by 283%, from $1.2 billion (2016-17 to 2018-19) to $4.6 billion (2019-20 to 2022-23), directly evidencing paradigm-shattering in both direct and indirect domestic value addition. Even more remarkably, indirect DVA (from domestic suppliers and service providers contributing towards backward linkages) leaped from $470 million to $3.3 billion within the same period, representing a whopping 604% increase. Cumulatively, this DVA exceeded $10 billion in 2022-23.
Factors behind the Jump
This huge change is attributed to continued government support and strategic policy interventions. The Production Linked Incentive (PLI) scheme, started in 2020, has been instrumental in supporting large-scale electronics manufacturing and export-led production. In what is a remarkable zoom of growth, India has become the world’s third-largest mobile phone exporter, with exports rising from a mere $0.2 billion in 2017-18 to $24.1 billion in 2024-25. This shows a “structural shift,” so much so that it is now exports that overshadow domestic consumption.
Employment and Policy Recommendations
Apart from this, the manufacturing boom comes with large-scale employment opportunities. According to ASI data, the sector directly or indirectly employs more than 17 lakh (1.7 million) people as of 2022-23, with export-linked employment increasing by over 33 times. The report advocates that policymakers should keep focusing on an outward-oriented industrial strategy with tariff and trade distortions addressed and emphasize achieving scale before imposing premature localization on components, improving logistics infrastructure, attracting foreign direct investment, and developing a strong associated ecosystem to maintain this momentum.
Industry Approval
Pankaj Mohindroo, Chairman of the India Cellular & Electronics Association (ICEA), pronounced the findings of the report, stating that the study gives credence to ICEA’s long-standing position that “strategic integration into global value chains is critical for scaling exports, enhancing domestic value addition, and creating jobs.” These findings strengthen India’s budding role as a global electronics manufacturing powerhouse.
