More Stories

Informist, Tuesday, Jul. 1, 2025

 

--Cabinet OKs INR-994-bln for employment-linked incentive scheme 

 

NEW DELHI - The Union Cabinet has approved the employment-linked incentive scheme to increase job creation in the country, the government said in a release Tuesday. The scheme is expected to created more than 35 million jobs in two years and has an outlay of INR 994.46 billion.

 

Of the total expected beneficiaries, 19 million will be first timers entering the workforce. The benefits of the scheme would be applicable to jobs created between Aug. 1 and Jul. 31 2027, the government said.

 

The scheme--first announced in the Union Budget for 2024-25 (Apr-Mar)--consists of two parts. Part A focusses on first timers and Part B focusses on employers. The first-time employees registered with Employees' Provident Fund Organisation will get one month's wage up to INR 15,000 in two instalments. 

 

"Employees with salaries up to Rs 1 lakh (INR 100,000) will be eligible," the government said. "The 1st instalment will be payable after 6 months of service and the 2nd instalment will be payable after 12 months of service and completion of a financial literacy programme by the employee."

 

The government will keep a portion of the incentive in a savings deposit account for a fixed period to encourage the habit of saving. This amount can be withdrawn by the employee at a later date, the government said. 

 

The second part of the scheme will focus on generation of additional employment in all sectors, especially the manufacturing sector. Under this, the employers will get incentives for a period to two years for generating additional employment, with extended benefits for another two years for the manufacturing sector. 

"The employers will get incentives in respect of employees with salaries up to Rs 1 lakh (INR 100,000). The government will incentivise employers, up to Rs 3000 (INR 3000) per month, for two years, for each additional employee with sustained employment for at least six months," the government said. For the manufacturing sector, incentives will be extended to the third and fourth years as well.

 

Establishments registered with EPFO and having less than 50 employees will have to hire at least two additional employees for at least six months under the scheme. For firms with 50 or higher employee will have to hire five additional employees on a sustained basis for at least six months. 

 

"With ELI (employment-linked incentive) Scheme, the government intends to catalyse job creation in all sectors, particularly in manufacturing sector, besides incentivising youth joining the workforce for the first time," the government said.  End

 

Reported by Shubham Rana

Edited by Vandana Hingorani

 

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

 

Informist Media Tel +91 (11) 4220-1000

Send comments to feedback@informistmedia.com

 

© Informist Media Pvt. Ltd. 2025. All rights reserved.