Outlook Business Desk
On July 1, the Prime Minister Modi-led Cabinet approved the Employment Linked Incentive (ELI) scheme to boost job creation and social security, focusing especially on the manufacturing sector.
The ELI scheme will be implemented from August 1, 2025, to July 31, 2027, covering multiple sectors and encouraging employment growth across the country.
With an outlay of ₹99,446 crore, Union Minister Ashwini Vaishnaw said the ELI scheme will help generate over 3.5 crore jobs across India by promoting employment and supporting workforce expansion.
The ELI scheme has two components—support for first-time employees and incentives for employers. Freshers registered with the Employees’ Provident Fund Organisation (EPFO) and earning up to ₹1 lakh/month will get up to ₹15,000 in EPF wage subsidy, paid in two instalments after 6 and 12 months.
For each new employee earning up to ₹10,000/month, employers will receive a proportional incentive up to ₹1,000/month, based on the employee’s exact wage within that bracket.
If a new employee earns between ₹10,001 and ₹20,000 per month, the employer will get a fixed incentive of ₹2,000 every month. For those earning above ₹20,000 and up to ₹1 lakh, the employer will receive ₹3,000 per month per employee.
Employers will also receive up to ₹3,000 per month for each new hire retained for at least six months. The benefit will last for two years, and up to four years for manufacturing companies.
Firms with fewer than 50 employees must hire at least two additional workers; those with 50 or more must hire five. New hires must earn up to ₹1 lakh/month to qualify. Payments will be made via Aadhaar-linked Direct Benefit Transfer (DBT) for employees and PAN-linked business accounts for employers.
According to a government release: “To encourage saving habits, a part of this amount will be deposited in a savings account that can be withdrawn later.”