Daijiworld Media Network – New Delhi
New Delhi, Jul 1: In a significant push to address youth unemployment and encourage formal job creation, the central government has launched the Employment Linked Incentive (ELI) Scheme, which aims to benefit both first-time workers and employers across sectors, particularly manufacturing. The scheme was first unveiled in the Union Budget 2024–25 as a major component of the Prime Minister’s employment and skilling initiative, backed by a Rs 2 lac cr package intended to empower 4.1 cr youth.
Under the ELI scheme, first-time employees who are newly registered with the Employees’ Provident Fund Organisation (EPFO) will receive financial support equivalent to one month’s wage, capped at Rs 15,000, in two instalments. This benefit is targeted at nearly 1.92 cr individuals entering the formal workforce for the first time. The first instalment will be credited after six months of continuous service, while the second will follow upon completion of one year and successful participation in a financial literacy programme. A portion of the benefit will be deposited into a dedicated savings account, ensuring long-term financial security for the beneficiary.
The scheme also provides strong support to employers by offering monthly incentives for hiring and retaining new workers. These incentives will be based on the wage bracket of the employees. For workers earning up to Rs 10,000 per month, employers will receive up to Rs 1,000 per employee. For those earning between Rs 10,001 and Rs 20,000, the incentive will be Rs 2,000, while for employees earning between Rs 20,001 and Rs 1 lac, employers will receive Rs 3,000 per month. To qualify for these incentives, employers with fewer than 50 employees must hire at least two new workers, and those with 50 or more employees must recruit a minimum of five. While the incentives will be available for two years across sectors, they will be extended to the third and fourth years specifically for employers in the manufacturing industry.
The government expects this scheme to contribute to the creation of around 2.6 cr new jobs. Payments under the ELI scheme will be made directly to employees via Direct Benefit Transfer (DBT) using the Aadhaar Bridge Payment System. Employers, on the other hand, will receive incentives directly into their PAN-linked bank accounts.
Welcoming the scheme, Dr Anish Shah, Immediate Past President of the Federation of Indian Chambers of Commerce and Industry (FICCI), said the ELI Scheme represents a bold and timely intervention to tackle India’s employment challenge. He praised its focus on incentivising first-time workers, strengthening manufacturing, and encouraging employer participation. He added that the scheme’s emphasis on dignity, security, and formalisation aligns closely with the aspirations of Indian industry.
The launch of the ELI Scheme marks a strategic move by the government to strengthen India’s labour market and ensure that the country’s youth are equipped with both employment and the necessary financial awareness to thrive in a changing economy.