In a major step toward boosting employment, enhancing social security, and encouraging formal workforce participation, the Union Cabinet, chaired by Prime Minister Shri Narendra Modi, has approved the Employment Linked Incentive (ELI) Scheme.
With a total outlay of nearly ₹1 lakh crore, the ELI Scheme aims to generate over 3.5 crore new jobs in the country over the next two years, especially benefitting first-time jobseekers and the manufacturing sector.
🧾 Key Highlights of the ELI Scheme
🔹 Scheme Name: Employment Linked Incentive (ELI)
🔹 Duration: August 1, 2025 – July 31, 2027
🔹 Total Outlay: ₹99,446 Crore
🔹 Target Jobs Created: 3.5+ Crore
🔹 First-Time Employees Supported: 1.92 Crore
🔹 Launch Context: Announced in Union Budget 2024–25 as part of a ₹2 lakh crore package for skilling, employment, and entrepreneurship.
🧩 Scheme Structure: Two-Part Approach
🔹 Part A – Incentives for First-Time Employees
This part supports first-time entrants to the workforce, especially those registered with EPFO.
Benefits:
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One month’s EPF wage (up to ₹15,000), in two installments
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Eligibility: Salary up to ₹1 lakh/month
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Installment Breakdown:
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1st Installment: After 6 months of sustained employment
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2nd Installment: After 12 months of service + completion of Financial Literacy Training
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A portion of this incentive will be deposited in a savings instrument, encouraging long-term financial planning.
✅ Expected Beneficiaries: 1.92 Crore new employees
🔹 Part B – Incentives to Employers for Job Creation
Designed to encourage new job creation across all sectors, especially manufacturing, by supporting employers.
Employer Incentives (Per Additional Employee):
| EPF Monthly Wage | Incentive to Employer |
|---|---|
| Up to ₹10,000 | Up to ₹1,000 |
| ₹10,001–₹20,000 | ₹2,000 |
| ₹20,001–₹1,00,000 | ₹3,000 |
Conditions:
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Employer must be EPFO-registered
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Minimum hiring:
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2 employees if establishment has <50 staff
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5 employees if 50 or more staff
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Employee must work continuously for 6 months
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Manufacturing sector will get extended incentives for 3rd and 4th year as well
✅ Expected Impact: Creation of 2.6 crore+ jobs under this part
💳 Incentive Payment Mechanism
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Employees (Part A): Direct Benefit Transfer (DBT) via Aadhaar-Based Payment System (ABPS)
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Employers (Part B): Paid to PAN-linked bank accounts through a secure digital platform
🎯 Objectives of the ELI Scheme
✅ Encourage formal job creation
✅ Boost manufacturing sector employment
✅ Promote youth employability and savings
✅ Support social security expansion
✅ Strengthen financial literacy and workforce formalization
🏁 Final Thoughts
The Employment Linked Incentive (ELI) Scheme is a bold and strategic step towards Viksit Bharat 2047, focused on creating millions of formal, secure jobs. With a dual approach, supporting both jobseekers and employers, this scheme is expected to transform India’s employment landscape, reduce informality, and fuel growth in key sectors.
Stay tuned for updates, guidelines, and registration details under our PM Schemes section.
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