Ahead of state polls, cabinet approves Rs 1 lakh crore scheme aimed at creating 3.5 crore jobs | India News

NEW DELHI: The Cabinet Tuesday approved the Rs 1-lakh crore Employment Linked Incentive (ELI) scheme, aimed at generating more than 3.5 crore jobs in the organised sector. Announced in July 2024, the scheme is meant to counter criticism over inadequate jobs being created in the economy at a time when there is a rising number of job seekers in the market. The decision comes ahead of assembly elections in Bihar, West Bengal, Assam, Kerala and Tamil Nadu.I&B minister Ashwini Vaishnaw said the scheme was finalised after detailed deliberation with industry leaders and other stakeholders.The scheme has two elements, one targeted at first-time employees who earn up to Rs 1 lakh a month and are members of the Employees Provident Fund Organisation. The Centre will pay up to Rs 15,000 each to around 1.9 crore employees. Govt hopes these jobs will be created by Aug 2027.ELI to aid newcomers in electronics, auto & semiconductor space The Rs 15,000 payment to first-time employees will be split into two instalments, with the second payment to be made after 12 months directly into their bank accounts.The second part is targeted at encouraging manufacturing companies to hire more. Govt will offer up to Rs 3,000 a month for two years for each additional employee who stays on for six months or more. For the manufacturing sector, the incentives will be extended to the third and fourth year as well. “Establishments which are registered with the EPFO will be required to hire at least two additional employees (for employers with less than 50 employees) or five additional employees (for employers with 50 or more employees) on a sustained basis for at least six months,” an official statement said.The scheme may benefit several of the new entrants coming up with new facilities, especially in electronics, semiconductors and the automobiles space.“ELI is a significant step towards boosting employment and formalising India’s workforce. ELI scheme opens doors for first-time job seekers, empowering them to contribute meaningfully to India’s growth story. It empowers employers to expand their workforce and gives a decisive push to India’s labour-intensive sectors,” said CII director general Chandrajit Banerjee.