Cabinet Approves ₹99,446 Cr Employment Linked Incentive (ELI) Scheme to Create 3.5 Crore Jobs
By Shishta Dutta | Updated at: Oct 27, 2025 12:01 PM IST
New Delhi, July 1—The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the Employment Linked Incentive (ELI) Scheme, which aims to generate over 3.5 crore formal jobs across India over the next two years, with a total outlay of ₹99,446 crore.
This transformative initiative is designed to enhance employability, social security, and workforce formalization, with a particular focus on the manufacturing sector.
Key Highlights of the ELI Scheme
| Feature | Details |
|---|---|
| Total Outlay | ₹99,446 crore |
| Duration | August 1, 2025 – July 31, 2027 |
| Total Jobs Targeted | 3.5 crore (including 1.92 crore first-time employees) |
| Focus Sector | All sectors, with extended incentives for the manufacturing sector |
| Announced In | Union Budget 2024–25, under PM’s ₹2 lakh crore youth employment package |
Part A: Benefits for First-Time Employees
This segment offers direct incentives to individuals entering the formal workforce for the first time.
| Eligibility | EPFO-registered first-time employees with salary up to ₹1 lakh/month |
|---|---|
| Incentive Amount | One-month EPF wage up to ₹15,000, disbursed in two tranches |
| Disbursement Schedule | 50% after 6 months, remaining 50% after 12 months and financial literacy completion |
| Mode of Payment | Direct Benefit Transfer via Aadhaar Bridge Payment System (ABPS) |
| Special Savings Provision | Partial incentive to be locked in a deposit account to promote savings |
| Expected Beneficiaries | 1.92 crore individuals |
Part B: Incentives for Employers
Employers hiring additional staff will receive monthly financial incentives for up to four years (manufacturing only).
| Eligibility | EPFO-registered employers hiring 2–5+ additional employees |
|---|---|
| Minimum Hiring Criteria | 2 (for firms <50 employees) or 5 (for firms ≥50 employees), retained for 6+ months |
| Salary Range Covered | Employees earning up to ₹1 lakh/month |
| Incentive Structure | See table below |
| Payment Mode | Direct credit to PAN-linked employer accounts |
| Expected Impact | 2.60 crore new employment opportunities |
Employer Incentive Table
| EPF Wage Slab | Monthly Incentive per Additional Employee |
|---|---|
| Up to ₹10,000 | Up to ₹1,000 (proportional) |
| ₹10,001 – ₹20,000 | ₹2,000 |
| ₹20,001 – ₹1,00,000 | ₹3,000 |
Strategic Goals and Impact
The ELI Scheme promotes large-scale job creation, strengthens formal workforce participation, and ensures wider coverage under EPFO. By incentivising both employees and employers, the scheme is expected to catalyse youth participation in the formal economy while fostering a culture of long-term employment and financial literacy.
About the Scheme
The ELI Scheme is part of a broader ₹2 lakh crore employment and skilling package announced in the Union Budget 2024–25, targeting 4.1 crore youth. It represents a significant step in India’s commitment to inclusive growth, social protection, and formal job creation through strategic fiscal support and regulatory facilitation.
REF: https://www.pib.gov.in/PressReleaseIframePage.aspx?PRID=2141129
Disclaimer: At HDFC SKY, we take utmost care and due diligence in curating and presenting news and market-related content. However, inadvertent errors or omissions may occasionally occur.
If you have any concerns, questions, or wish to point out any discrepancies in our content, please feel free to write to us at content@hdfcsec.com.
Please note that the information shared is intended solely for informational purposes and does not make any investment recommendations
