Samsung’s smartphone exports are experiencing a sharp decline. The company’s exports fell by approximately 20% in the initial quarter of fiscal year 2025-26. This drop is primarily due to Samsung no longer receiving benefits from the Production Linked Incentive (PLI) scheme. This development potentially jeopardizes India’s goal of becoming a global smartphone manufacturing hub.
In the June quarter of FY25, Samsung’s smartphone exports were approximately $1.17 billion. This figure decreased to $950 million in the first quarter (July-September 2025) of FY26. This amount is also lower than the $1.2 billion recorded in the preceding quarter (January-March 2025).
Samsung is no longer eligible for PLI incentives, as the scheme’s five-year term (FY21-FY25) has ended. Due to COVID-19, the company did not meet its targets in FY22, and as a result, it did not receive incentives that year. Samsung now seeks an opportunity in FY26 to make up for the FY22 losses.
Reports indicate that manufacturing expenses in India are higher than those in Vietnam (10%) and China (15%). The PLI scheme provided a 4-6% incentive, partially bridging this cost gap. Without this incentive, manufacturing in India could become more expensive, potentially causing companies to shift production to Vietnam or China.
Apple and Dixon Technologies will also exit the PLI scheme after FY26. Dixon produces phones for Motorola, Google, and Xiaomi in India. If these companies also reduce their exports due to a lack of incentives, India’s ambition to be a smartphone export hub could be hindered.
The government acknowledges that the absence of incentives diminishes India’s competitiveness, but a decision on extending the PLI scheme is yet to be made. The government has recently launched a new component PLI scheme valued at ₹22,919 crore to enhance local value addition.